An Ignoble Experiment

1. Comcast video subscriber losses widen to 60,000 in Q1 2013

Years ago, soon after I began writing about the TV business, I investigated how I could find one of the households that Nielsen uses to generate its ratings reports. I thought it'd make for a great feature, documenting how one of the families that Nielsen selects for its ratings sample uses the People Meter, its key measurement tool.

I never found a Nielsen household. Nielsen doesn't reveal where they are, for fear that the viewing habits from its sample could be influenced. But this February, the next best thing happened: A Nielsen representative called me and asked if I'd be willing to participate in a ratings survey. "Sure," I said, hoping I didn't sound too eager, as I pictured a Nielsen rep showing up at my home the next week to install one of the People Meters it places in just 37,000 U.S. homes to generate ratings reports.

Had I still lived in New York, also known as Nielsen DMA No. 1, or Washington, D.C., the ninth largest market, there's a chance that I could've received a People Meter. But I've lived in the village of Liverpool, N.Y., located outside of Syracuse--DMA No. 86--since 2010. Syracuse is one of 150 smaller markets that Nielsen samples with one-week diaries four times a year during sweeps periods in February, May, July and November. I was sent a diary to measure one week of viewing during the February sweeps, along with five crisp $1 bills as an incentive to complete the survey and mail it in.

Source: Steve Donohue
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I never completed the diary Nielsen wanted me to use for a week in February, as I was swamped that week with work and a baby with a stomach virus. I thought I had blown my chance at participating in a Nielsen survey and an opportunity to write about it, until Nielsen called again a few weeks ago. The representative didn't mention the February diary that I never mailed back, but just ran through the same set of questions asked before, including whether I worked for a TV station or broadcast network, or a cable network or operator, or if anyone in my family worked for a TV network, station, or operator. I said no, and last Tuesday, received a Nielsen diary for the week beginning April 25, along with another $5...Continued

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2. Comcast investing in advanced services for Xfinity Home and X1 platforms

Comcast (Nasdaq: CMCSA) said Wednesday that it lost 60,000 basic video subscribers in the first quarter, while it gained 433,000 high-speed Internet and 211,000 voice customers.

Its video subscriber losses widened compared to the first quarter of 2012, when it shed 37,000 video subscribers. While its voice customer growth increased compared to the 164,000 it added this time last year, it added 6,000 fewer cable modem customers compared to the first quarter of 2012. "Our goal is to continue to make progress in reducing video subscriber losses," Comcast CEO Brian Roberts told analysts on its earnings call.

Business services continues to be a bright spot for Comcast, with revenue from its commercial division jumping 27.5 percent to $741 million. Revenue from its Cable Communications Division increased by 6.4 percent to $10.2 billion.

An 8.6 percent increase in license fees that Comcast's NBCUniversal subsidiary collects from pay TV providers for USA Network, SyFy, CNBC and other cable networks helped revenue from its cable networks segment jump 4.6 percent to $2.2 billion. But revenue from NBC and its owned-and-operated stations took a hit, dropping 18.5 percent to $1.5 billion because of lower ratings at The Peacock Network. NBC was also not positively impacted by having the Super Bowl on its schedule this year, although the championship game helped NBC generate $259 million in revenue in the first quarter of 2012, Comcast said.

Comcast reported $15.3 billion in total revenue in Q1, up 2.9 percent compared to the same period last year. Operating cash flow increased 7.4 percent to 5 billion, and it posted earnings per share of 54 cents, up 20 percent compared to last year.

For more:
- see the release

Special Report: Cable in the first quarter of 2013

Read more about: Comcast
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By Steve Donohue

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3. CenturyLink hits Cox with 1-Gig network in Omaha

Comcast (Nasdaq: CMCSA) is investing in advanced services that it can tack on to its Xfinity Home automation and X1 video products, including delivering DVR programming to new devices, executives told analysts Wednesday.

CEO Brian Roberts said on Comcast's first-quarter earnings call that future versions of the X1 platform will include improvements in the way subscribers can search for content and access programming on DVRs as well as move it "across other devices." Time Warner Cable (NYSE: TWC) disclosed in a patent application published last week that it is also developing technology that could allow it to deliver DVR programming to devices other than a TV, including smartphones and PCs.

Comcast launched X1, which runs on home gateway set-tops from Pace (LSE: PIC.L), last year. The product is now available in 30 percent of Comcast markets, Comcast Cable Communications CEO Neil Smit told analysts. X1 will expand to 50 percent of Comcast's footprint by the end of the second quarter, he added.

Smit said Comcast is also looking to introduce new services through its Xfinity Home platform. The platform is available nationwide and offers subscribers home security and automation services including lighting and thermostat controls, and carbon monoxide and flood sensors. Comcast is beginning to deploy new Xfinity Wireless Gateways from Cisco (Nasdaq: CSCO) that are capable of delivering data of up to 270 Mbps to devices in subscriber homes, partly because it sees "opportunities for products we could hang off" the WiFi gateways, Smit said.

While Smit didn't detail the new products Comcast is looking to deliver through Xfinity Home, executives have previously said Comcast wants to introduce home healthcare services. The MSO explained how it may be able to add automobile security to the platform in a patent application it filed last summer and allow subscribers to receive alerts on TV and mobile devices if someone attempts to steal their cars.

Also worth noting from Comcast's earnings call:

Smit attributed the 60,000 video subscribers that Comcast lost in the first quarter to a rate increase that it implemented on 72 percent of its footprint during the quarter. During the first quarter of 2012, Comcast raised rates on 62 percent of its footprint, he noted. Most of the defections were from customers who only subscribed to its video product, Smit said.
Comcast is marketing joint promotions with Verizon Wireless (NYSE: VZ) through 500 Verizon retail stores, and the MSO and Verizon have developed a product roadmap that will take advantage of mobile video, Smit said. "The data usage on mobile phones is very high for video, and we think there's a real opportunity there as well," he added.
CFO Michael Angelakis said more Comcast subscribers are self-installing new services, and that 29 percent of Comcast subscribers manage their accounts online.

For more:
- see the Comcast earnings release

Read more about: Xfinity Home
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By Steve Donohue

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4. Time Warner rides HBO, Turner subscription fee hikes in Q1

CenturyLink (NYSE: CTL) said Wednesday that it'll offer download speeds of up to 1 Gbps in Omaha, Neb., providing more competition for incumbent cable operator Cox Communications.

About 48,000 homes and businesses in Omaha will be connected to CenturyLink's fiber network by October in what the company described as a pilot program. CenturyLink said in a statement that it'll evaluate the Omaha pilot before "determining further deployment of this advanced technology."

CenturyLink's move follows announcements from Google Fiber (Nasdaq: GOOG) that it will expand its 1-gig service to Austin, Texas, and Provo, Utah. Time Warner Cable (NYSE: TWC) and Comcast (Nasdaq: CMCSA) will feel the brunt of the Google Fiber rollout.

Asked to comment on how the CenturyLink upgrade could impact Cox, spokesman Todd Smith noted that the Atlanta-based MSO offers speeds of up to 150 Mbps in Omaha and several other markets through its Ultimate residential package. "It is important to note that our most popular Internet package remains the one that provides speeds of 25 Mbps, which meets the needs of the majority of customers," Smith told FierceCable.

Smith also noted that Cox already offers business customers speeds of up to 10 gigabits per second. "We will continue to talk with our customers and invest in product enhancements to provide an optimal broadband experience," he added.

For more:
- see the release

Read more about: Comcast, Time Warner Cable
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By Steve Donohue

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