Cablevision Systems Corp. expects to offer its network DVR service and a new cloud-based set-top navigation system in all its East Coast systems by year's end as the MSO wraps up its digital-to-analog transition, company President and CEO Jim Dolan said Thursday during the MSO's second-quarter call.

Cablevision has already launched its DVR Plus service across much of its eastern footprint, including parts of the Bronx, Brooklyn, Long Island and Connecticut. The current version of the service lets customers store up to 24 hours of HD programming. It runs $10.95 per month -- the same amount that Cablevision charges for set-tops with integrated DVRs.

"Once we are 100 percent digital, we will be able to offer the RS (remote storage)-DVR throughout the East footprint, which is something that we feel, strategically, has great value to us," said Cablevision SVP and CFO Gregg Siebert.

Cablevision, which competes primarily with Verizon Communications Inc. in the northeast, introduced DVR Plus in the Bronx in January 2011. According to Dolan, more than 200,000 Cablevision customers now subscribe to the network DVR service (its East Coast systems serve about 3 million video customers, so it's still a lightly penetrated service). Cablevision has yet to say when it will bring DVR Plus to the former Bresnan Communications systems that serve rural parts of Wyoming, Colorado, Utah and Montana. (See Cablevision's Network DVR Debuts in the Bronx and Cablevision Goes Country With Bresnan Buy.)

Completing the digital conversion out east will help Cablevision pack more of its video service into the cloud, and help it reduce its reliance on pricey set-tops with hard drives. But the anticipated capex savings from that strategy aren't here yet. Cablevision's $90 million increase in capital spending in the second quarter for its East Coast systems was due in part due to its ongoing digital conversion and the expansion of its network DVR product. (See Cablevision Eyes $50 Set-Top.)

Cablevision's all-digital strategy is also setting the stage for the rollout of a cloud-based navigation system it calls Onyx. Cablevision hasn't shown off a final version yet, but Dolan says it's similar to the guide the operator has deployed on IP-connected devices such as iPads, PCs and, most recently, the Kindle Fire. Cablevision execs said the new guide will work on all its set-tops, and expects to have it deployed to most of its East Coast systems by the end of 2012. Further down the road, Onyx is expected to help Cablevision deliver video services to IP-connected TVs without the need for a separate set-top box.

Q2 financial update
Before the cloud rolls in, meanwhile, Cablevision said video subscribers were flat in the second quarter, which is almost like gaining customers in period that historically haunts cable operators as students and snowbirds disconnect for the summer. Wall Street analysts were expecting a loss of 11,000 video subs. Cablevision added 25,000 high-speed Internet customers and 23,000 voice customers -- slightly better than what analysts were expecting.

Cablevision posted net income of $63.5 million (24 cents per share) on revenues of $1.7 billion. Analysis were expecting 20 cents per share on revenues of $1.69 billion.

— Jeff Baumgartner, Site Editor, Light Reading Cable