Time Warner Cable video results lacklustre despite 44% profit jump

Michelle Clancy ©RapidTVNews | 27-01-2012

The economy may still be slumping, but Time Warner Cable was able to realise a net profit of $564 million for the fourth quarter of 2011, a 44% increase from a year earlier.
The success, however, had very little to do with its bread-and-butter video and TV segment.
Revenue from video subscriptions remained flat with a mere 0.2% bump year-over-year. And, it lost 129,000 video customers in the residential segment during the quarter. Advertising revenue meanwhile dropped 10%. Overall, the stats paint a picture of a cable company that is still struggling with intensifying competition and a public increasingly unwilling to fork out $100+ subscription fees every month.
However, the company may be profiting from an increasing thirst for online video streaming from over-the-top (OTT) players like Netflix and Hulu. The number of high-speed data subscribers rose by 117,000 in the quarter, while it saw an 8.6% increase in revenue from high-speed residential Internet subscriptions. Residential-services revenue in general increased 2.6% to $4.28 billion, led by the broadband gains.
Overall, revenue at the No. 2 U.S. cable company (second only to Comcast) jumped by 4 percent, to $5 billion. The MSO added a net 51,000 subscribers for the quarter to total 26.9 million.
The results show "the continued strength of our business amidst rapid change in technology and the consumer marketplace,” said Glenn Britt, TWC's CEO.