Comcast slows sub losses
November 3, 2011
Comcast’s third-quarter profit rose 4.7 per cent, as the cable company increased Internet-access subscriptions and slowed pay-TV defections—despite weaker results from its newly acquired NBC broadcast network and Universal movie studio.
The largest US cable operator has struggled with stalling industry-wide growth in pay-TV subscribers in the recession. Instead, much of Comcast’s growth in its core cable-service segment has come from selling more-profitable broadband Internet subscriptions, where revenue grew 9.8 per cent to $2.2 billion for the quarter.
But Comcast’s losses in video subscribers did slow for the fourth consecutive quarter compared losses a year earlier—echoing smaller quarterly losses at other cable operators. Comcast has been trying to hang onto TV subscribers by offering advanced TV services, such the ability to watch more programs on demand, and iPad apps that allow viewers to watch and control TV.
Comcast lost a net 165,000 video subscribers during the quarter, compared with the loss of 275,000 in the year-earlier period. It added a net 261,000 high-speed data customers, up from 249,000 a year earlier.
The cable giant also said that the national advertising on its suite of cable and broadcast TV channels remains solid, despite worries about the economic outlook. Some ad buyers have signalled that sales of ads that air close to when they are purchased is looking softer in the fourth quarter, but media companies have yet to indicate they see signs of a slowdown.
“We are seeing lots of demand for all sorts of cable and broadcast advertising,” said Steve Burke, chief executive of Comcast’s NBCUniversal unit. Comcast acquired a majority stake in NBCU from General Electric Co. in January.
Comcast reported a profit of $908 million up from $867 million a year earlier. Revenue jumped 51% to $14.34 billion, but would have been up 4.9 per cent had Comcast owned NBCUniversal during the year-earlier period.
NBCUniversal saw revenue rise 4.6 per cent to $5.2 billion on strong performances from its cable-TV channels, like USA, as well as its theme parks. But the broadcast-TV unit struggled, dragged down by flagging viewing at the NBC network. The group, which also includes Spanish-language Telemundo and local TV stations, saw revenue rise 2.9 per cent to $1.5 billion, buoyed partly by syndication revenue.