Cablevision Systems Corp.'s spending on set-tops could drop as low as $50 per box thanks to the rollout of its remote-storage DVR (RS-DVR) service and receivers that use the MSO's new downloadable security system, executives said Wednesday.

COO Tom Rutledge told analysts on Cablevision's fourth-quarter earnings call that it has "ceased" ordering physical DVRs, following the recent launch of its network DVR in New York. Cablevision plans to expand the rollout of the "DVR Plus" service, which allows subscribers to record up to four shows at once, to its entire New York area footprint this year. (See Cablevision's Network DVR Debuts in the Bronx and Podcast: Cablevision's Network DVR.)

While Rutledge said he expects that Cablevision will continue to buy set-top boxes "for years to come," he said the operator will develop applications with consumer electronics manufacturers that would allow it to deliver programming to subscribers without set-tops -- something that Comcast Corp. and Time Warner Cable Inc. are already championing.

"It’s an opportunity to further get out of the hardware-purchasing business at the CPE [customer-premises equipment] level," Rutledge said when asked about new, broadband-connected TVs that Samsung Corp. and other CE vendors showed off last month at the Consumer Electronics Show in Las Vegas. (See CES 2011: Samsung Puts MSOs in the Picture.)

The rollout of set-tops that support downloadable security could see Cablevision's costs approach $50 per box, depending upon the features, Rutledge said. (See Samsung Boxes Break In at Cablevision .)

"If we stayed at historic capability in boxes, the cost curve would move us toward that [$50 per box] number," Rutledge said, adding that Cablevision expects its set-tops costs to decrease even as it increases the capabilities of the devices. (See Cablevision Makes its Security Deadline and Cablevision May Take Security for a Spin(off) .)

Subscriber pressure
Cablevision is banking on the rollout of advanced products to help retain subscribers. It lost 35,000 video subscribers during the fourth quarter, but Rutledge said most of those losses were related to the company's retransmission consent battle with Fox Broadcasting Co., which saw the MSO lose Fox's signal during the baseball World Series. (See Cablevision to Pay for World Series Streams.)

Cablevision added just 5,500 new high-speed data subscribers, excluding the customers it picked up through its acquisition of Bresnan Communications LLC, and it signed 9,200 new voice subscribers. (See Cablevision Goes Country With Bresnan Buy and Cablevision Posts Q4 .)

Noting that Cablevision missed Wall Street estimates for subscriber growth, and that broadband growth appeared to "hit a wall," Sanford C. Bernstein & Co. Inc. analyst Craig Moffet said Cablevision’s performance should give investors reason to pause. "We continue to see Cablevision as a very good asset, but one that is now approximately fully valued," he wrote in a note issued Wednesday.

Also worth nothing from Cablevision’s fourth-quarter earnings report and conference call: