Comcast Adds Record 2.5M Subs in '07
The MSO posted fourth quarter revenues of $8.0 billion, up 14 percent from the year-ago period. For the full year, revenues came in at $30.8 billion, up 24 percent. (See Comcast Posts Q4.)
Comcast posted quarterly net income of $602 million (20 cents per share), up 54 percent year-over-year. For all of 2007, net income was $2.58 billion, up just 2 percent.
Comcast lost 180,000 basic cable subs in 2007, giving it 24.1 million at year-end. It lost 94,000 basics in the fourth quarter. However, the MSO added a record 2.5 million digital cable customers for the year, a 33 percent jump from the 1.9 million it added in all of 2006. Additionally, 6.3 million, or 42 percent, of its digital subs took an “advanced” service such as a digital video recorder (DVR) or high-definition television (HDTV), versus 36 percent a year ago.
Fueled in part by a $774 million, 22 percent increase in pay-per-view-related revenue (which includes video-on-demand), Comcast’s video revenue for 2007 clocked in at $17.7 billion, up 7 percent.
Confirms ’08 Docsis 3.0 plans
Comcast added 1.7 million high-speed Internet subs for 2007, extending its total to 13.2 million.
On a conference call Thursday morning, Comcast Corp. COO Steve Burke confirmed that the MSO has allocated capital to deploy Docsis 3.0 to 20 percent of its footprint in 2007, laying the groundwork to offer speeds of 100 Mbit/s or more. In the meantime, Comcast has been expanding the availability of Blast!, a 16 Mbit/s (downstream) tier that taps the legacy Docsis modem and cable modem termination system (CMTS) platform. (See Comcast Closes In on 100 Mbit/s and Comcast Has a 'Blast!' in the Bay .)
But not all of Comcast’s modem initiatives involve faster speeds. Burke, noting that 64 percent of Comcast’s net high-speed adds came from “DSL migrations,” is using an “economy tier” to attract more price-sensitive customers. It’s also using the cheaper product to help the MSO adapt to slower housing trends and a weaker overall economy that contributed to the lowering of the MSO’s original 2007 guidance. (See Comcast Lowers RGU Guidance.)
That tier, at $24.95 per month, caps the downstream at 768 kbit/s and the upstream at 384 kbit/s, according to a Comcast official.
Although signups for Blast! have outpaced those for the economy tier, Burke acknowledged that the high-speed data business is “maturing,” and that Comcast expects to add fewer customers in 2008 than it did in 2007.
Phone service remained a strong point for the MSO, which added 2.5 million IP-based Comcast Digital Voice subs, up 61 percent from the previous year, expanding its total to 4.4 million. Comcast ended the year with fewer than 200,000 circuit-switched phone subs. It expects to wind down that portion of the business completely by the end of 2008.
For the year, capital expenditures increased 29 percent, to $6.0 billion, based largely on growth of revenue generating units (RGUs), and a 63 percent increase in deployed set-tops, including 2 million boxes with HD and/or DVR capability. Comcast ended the year with roughly 6 million RGUs, 20 percent higher than its 2006 total.
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