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Mediacom Motors Along

Alan Breznick
8/8/2017

Nearly bucking the prevailing winds among leading pay-TV providers, Mediacom Communications kept its video subscriber losses down in the second quarter while more than offsetting those losses with broadband and voice customer gains.

Mediacom Communications Corp. , now the fifth-largest US MSO with close to 1.4 million customers due mainly to recent industry consolidation, reported shedding just 3,000 video customers in the historically weak second quarter. That's well down from the 11,000 video subs it lost in the prior year's period. As a result, the privately held cableco closed out June with 829,000 video subscribers, down from 842,000 a year earlier, to generate $201.3 million in revenue, down 1% from $203.3 million the year before.

More than making up for the video sub loss, Mediacom added 6,000 broadband customers in the spring quarter. While that gain was less than half the 14,000 data subs the MSO netted a year earlier, it still boosted its total to almost 1.2 million, up 5.1% from a year earlier. Thanks to this increase and price hikes, the company produced $167 million in broadband revenue for the quarter, up 11.8% from the year-ago period.

The small-but-steady broadband gains come as Mediacom continues to roll out gigabit service throughout its territories, primarily by deploying the new DOCSIS 3.1 spec. The cableco, which introduced 1-gig speeds in its first markets last fall as part of its $1 billion capital upgrade plan and "Project Gigabit" initiative, aims to extend service to virtually all 3 million homes and businesses passed in its 22-state footprint by the end of this year. (See Mediacom Unveils $1 Billion Capital Upgrade Plan, Mediacom Going All DOCSIS 3.1 by Year-End and Mediacom Tricks Out 82 New Towns With Gig Service.)

On the voice end of the business, Mediacom posted its biggest customer gains, adding 25,000 telephony customers, up from 10,000 the year before. It ended the quarter with 520,000 voice subs, up 14.5% from a year earlier. But its voice revenue climbed just 2.4% to $28.2 million, likely because of heavier price discounts.

Finally, Mediacom continued its steady increases on the commercial side, taking in $62.2 million for the quarter, up 8.4% from a year ago. The cableco became the latest MSO to crack the $200 million mark for business services revenue last year.

Overall, Mediacom raked in $471.5 million in revenue for the spring period, up 4.6% from a year earlier. Operating income before depreciation and amortization (OIBDA), a measure of cash flow, rose 4% to $179.6 million.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

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craigleddy
craigleddy
8/8/2017 | 9:54:59 PM
Re: Size
Rocco Commisso built this company from the ground up and it remains one of cable's enduring stories. They're out front on DOCSIS 3.1 and a stalwart in business services, among other things. I imagine Rocco has had suitors waving big sums of money under his nose to buy him out but I hope he (and John Pascerelli and team) continue to stay independent and prove that small is beautiful.     
alison diana
alison diana
8/8/2017 | 4:24:14 PM
Re: Size
It's encouraging to see Mediacom growing and reversing some of its numbers. It'll be interesting to see how its DOCSIS 3.1 strategy continues to play out against some other providers' focus on fiber; I'm thinking specifically of Altice and its US operations. Consumers definitely win when there are more competitors. I think that every time I return to Long Island, NY, and see the prices they pay for faster broadband versus here on the Space Coast, FL. 
danielcawrey
danielcawrey
8/8/2017 | 3:14:35 PM
Size
This makes you wonder: Does scale really matter? It seems to me Mediacom is doing just fine. It's surprising to me, given the fact that the larger operators are on a constant mission to consolidate....
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