Comcast may be seeing subscriber pressure

Comcast may be seeing subscriber pressure

Summary: Comcast reported its second quarter earnings Thursday and the financials results were fine. The subscriber numbers, however, may indicate increased competition.

TOPICS: Hardware, Networking

Comcast reported its second quarter earnings Thursday and the financials results were fine. The subscriber numbers, however, may indicate increased competition.

The cable giant reported a profit of $588 million, or 19 cents a share, on revenue of $7.7 billion, which was up 31 percent from a year ago. The results were in line with Wall Street estimates.

But the subscriber totals are where things get interesting. The following stats may indicate that Comcast is feeling some pressure from Verizon FiOS (see gallery right).

A few points:

  • Comcast reported 12,380,000 cable modem subscribers in the second quarter, up 18 percent from a year ago. However, that sum was below the 12,440,000 projected by Morgan Stanley.
  • VOIP subscribers came in at 3,097,000 better than the 3,073,739 projected by Morgan Stanley.
  • High-speed Internet subscribers grew by 330,000 in the second quarter, the same sum as a year ago.
  • Comcast lost 95,000 basic video customers in the quarter. Reuters notes that's worse than estimates. Comcast was pushing digital video ahead of CableCARD boxes.
  • Capital spending was up 52 percent to $1.6 billion.

Adding up these crosscurrents I come up with the following:

  • Comcast is swiping telephone customers from existing carriers among entrenched cable modem customers.
  • Comcast is starting to feel some pressure from Verizon for Internet access. Whether that evolves into television remains to be seen.
  • The capital spending is largely related to advanced services to compete with things like Verizon FiOS.

It's too early to call anything definitive, but it's worth monitoring.

Topics: Hardware, Networking

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  • Down with the cable monopolies!

    It's funny how the cable companies tried to rally support through the public to stop the telephone companies from getting into TV and "FIOS" speed internet by claiming them as the "Bell Monopolies" when in truth the onlt REAL monopoly in our area for years WAS Comcast as they have exclusive rights to providing cable to the area.

    Lets hope more people jump on the FIOS train!
    John Zern
    • what's sad is

      that the US federal gov't enforced this when Adelphia went under... I do phone support for internet for comcast (all done by a 3rd party mind you), and unfortunately, the problem is not exclusive to comcast.

      In Texas (dallas) Verizon would go thru and dig up all the comcast lines when they were laying fibre, and of course it was comcast's fault (apparently). On the other hand, the service wasn't great in the first place compared to other markets.

      I still think the solution is this: regulate it. as a public service. don't let each state have different regulations if you really want something done about it. up here in canada, it got bad in Toronto years ago, but the federal gov't stepped in and passed a few laws mandating uptime, upgrades to equipment, etc. I heard somewhere that now, between Edmonton and Calgary (1 million or so ppl per city) there is a bigger pipe than what is used in all of California. and the equipment is mostly the same, my local cable isp purchases it all from comcast anyways.

      residential service is better here anyways, for the same price, and now we can get 25 mb down and 2mb up for around $95, or 10 down, and 1 up for $50.
  • They dont want basic cable subscribers any more

    They make it just as expensive to have the box or have basic. Why not have the box in atleast one room to watch more channels.

    I know for a fact that many cable providers are having problems with the cableCARD systems. They either dont work with their system, dont work with certain tv's(even though there is a standard) or they work but are missing random channels or the guide doesnt download or work correctly. The FCC gave them a grace period, so i guess you can expect to see those numbers climb once they get the bugs worked out.
  • Adelphia

    I want to know how many of the "new" customers were actually Adlephia customers that have been rolled into their numbers?
  • Adelphia con't..

    I will say that after Comcast took over, the high speed interent service was not as good as under Adelphia. We dropped from 8 MB to about 6 MB down, but the upload went from 768K down to 384K. After working with the local office to no avail, I called corporate and asked for the CEO. His office in turn handed me over to a VP. She was able to take a look at our account and service. Within 48 hours, our download speed jumped from 6 MB, to 20-25 MB, while upload jumped to 1.4-1.5 MB. I have tested over the last 6 weeks since they made what ever changes, and the speeds have remained constant.