Cablevision CEO: broadband is where it's at
DetailsMichelle Clancy | 06 May 2015
US cableco Cablevision has been making several moves geared for the digital age — and CEO James Dolan said there may be more to come as it focuses more on streaming and driving interest in broadband.
The company recently announced that it would bundle a digital antenna with its broadband, dubbing it a "cord-cutting" package. Cablevision is also the only cable provider to offer the premium over-the-top (OTT) HBO Now offering so far, and has just inked a deal with Hulu.
"It just more fully fills out our offerings to our customer base," Dolan said in an earnings call. "All cable and satellite companies have had issues with having very large bundles that are sometimes difficult for the customer to afford. Our ability to offer products underneath that has been limited. We see the cord-cutter package as a way of filling out that product line and offer levels of service that are less expensive than the big bundle."
Dolan said that it makes sense to focus on high-margin broadband instead of the less profitable video division. He expects video subscribers to decline another 10% to 20% over the next few years as what subscribers want continues to evolve.
"A new generation of consumers is coming in and I think they use video very differently," Dolan said. "We don't sit here watching Verizon all the time, nor do we watch DirecTV or Dish, what we watch is our customers. We take a look at what their customer experience is. We have great metrics about that; I think we're very good at knowing exactly what's going on with our customers. That's where you see a lot of the impetus for those changes."
Cablevision reported strong financial results in the first quarter of 2015 with average monthly cable revenue per customer increased significantly. Net income from continuing operations was $44.6 million, compared with $89.8 million in the prior-year quarter. Total revenue in the reported quarter came in at $1,614.8 million, up 2.5% year-over-year. Both beat analyst estimates.