Among major MSOs, Comcast Corp. (Nasdaq: CMCSA, CMCSK), Time Warner Cable Inc. (NYSE: TWC), and Cox Communications Inc. are each expected, for the first time, to break the $1 billion mark in the budding cable services category this year. Here's how some of the industry's top cablers are stacking up:
Table 1: MSO Commercial Services Revenue � 2010
|MSO||Q1 Revenue||Q2 Revenue||Q3 Revenue||Year-to-Date Revenue|
|Cox Communications||$270 million*||$290 million*||$300 million*||$860 million*|
|Time Warner Cable||$254 million||$268 million||$287 million||$809 million|
|Comcast||$263 million||$306 million||$333 million||$902 million|
|Cablevision Systems (Optimum Lightpath)||$68 million+||$71 million+||$73 million+||$212 million+|
|Charter Communications||$118 million||$121 million||$126 million||$365 million|
|Source: Heavy Reading and the companies. |
*Heavy Reading estimates.
While $5 billion is a nice, fat number, there's still plenty more commercial business left for cable to siphon off from the telcos. Cable's take represents just 4 percent of the overall US business services pie of $130 billion to $140 billion, according to Heavy Reading senior analyst Alan Breznick.
Cable "got serious about business services," he says, noting that the second and third quarters of 2010 represented the first time the US cable industry had back-to-back quarters with at least $300 million in commercial services revenues. "And now they're reaping the dividends of having gotten serious. "
To stoke that growth engine, cable's starting to move upmarket. After targeting businesses with 20 employees or less, several MSOs are now starting to more vigorously pursue businesses with up to 250 employees as operators get more heavily involved with products such as hosted voice services. (See CableLabs Project Targets SIP Trunking and Comcast Chases Big[ger] Business .)
Another area of growth is cellular backhaul. Today it represents no more than $200 million for cable, but there's more to be had as wireless carriers require extra capacity to support 3G and 4G services. Breznick estimates that the cable industry serves more than 11,000 cell backhaul towers, with TWC alone wiring more than 5,100 of them.
Be sure to check back. Light Reading Cable will have more coverage from the event throughout the day.
— Jeff Baumgartner, Site Editor, Light Reading Cable