It’s been apparent for many years that cable operators have moved from being purveyors of traditional video services to being a one-stop shop consisting of that product along with telephony, high-speed data and IPTV. Those products are delivered to a variety of legacy and emerging devices. That’s well known.
It’s interesting, though, to step back momentarily to see just how far from its roots, and from the product with which it still is most readily associated, the cable industry has moved. That transition is at no time as obvious as when earnings reports are released.
For example, Charter Communications had a good report, according to LightReading, despite losing 40,000 video subscribers between the second quarter of last year and the second quarter of 2014. (The company apparently jacked up prices, since video revenue increased 5.1 percent, to $1.1 billion, during that period.)
Cablevision Systems also released results. Reuters reports that about 28,000 video subscribers left during the quarter. Despite that, overall sales rose 3.7 percent, which beat the average analysts’ estimate.
A third company reporting results was Time Warner Cable. The video numbers in the report were not good, according to Ad Age:
Time Warner Cable lost 152,000 TV customers in a seasonally weak period when college students typically disconnect their service for summer vacation. That drop wasn't as bad as the 192,000 residential video subscribers Time Warner Cable lost in the second quarter of last year. But it was worse than the expectations of five analysts surveyed by Bloomberg News, who predicted a loss of 128,000 TV subscribers on average.
Finally, the big banana in cable television, Comcast, weighed in. Slate’s commentary noted that Comcast’s net income beat forecasts by almost $2 billion. But there is a more important theme, according to Alison Griswold:
More interesting is this line from Comcast's quarterly report: ‘Video Customer Net Losses Declined to 144,000; The Best Second Quarter Result in Six Years.’ Best second-quarter result in six years? Comcast must have seen some pretty brutal second quarters. To some extent, that's seasonal: Comcast customers include students who cancel their TV subscriptions at the end of a school year and summer vacationers who terminate their service before hitting the road.
The point about the seasonality is a fair one, and it was cited in the Time Warner Cable story as well.
What is worthy of noting is that all of these operators experienced video subscriber losses during the quarter, and all still fared pretty well. Cable executives deserve credit for being visionaries who recognized that their core business would change over the years and acted accordingly. That wouldn’t be too surprising, though. After all, an earlier generation of cable leaders made big bets on the potential of video.
Or, perhaps, the current decision makers are just very lucky.
Carl Weinschenk covers telecom for IT Business Edge. He writes about wireless technology, disaster recovery/business continuity, cellular services, the Internet of Things, machine-to-machine communications and other emerging technologies and platforms. He also covers net neutrality and related regulatory issues. Weinschenk has written about the phone companies, cable operators and related companies for decades and is senior editor of Broadband Technology Report. He can be reached at firstname.lastname@example.org and via twitter at @DailyMusicBrk.