Broadband Cable Association of Pennsylvania


January 28, 2014

Fourth-quarter profit at Comcast Corp. grew 26% as the cable operator added video customers after a more than six-year streak of declines and reported sales growth across almost all major segments.

In addition, the company raised its quarterly dividend by 15.4% to 22.5 cents and increased its stock buyback authorization to $7.5 billion. The company said it plans to repurchase $3 billion of stock in 2014. Comcast added 43,000 video customers in the quarter, compared with a loss of 7,000 a year ago. The cable industry generally has been losing video subscribers for years, mostly to newer competitors such as phone and satellite-TV companies. There also have been signs in the past couple of years that people are disconnecting their pay-TV service.

Comcast Chief Executive Brian Roberts earlier in January said the company's investments in recent years in upgrading its cable infrastructure helped improve its video-subscriber results. And while Comcast lost 305,000 video subscribers for all of 2013, the losses moderated slightly from 2012, and Mr. Roberts recently said the fourth-quarter growth signals the beginning of a trend reversal. The latest results also come as the cable industry appears ripe for consolidation, sparked by Charter Communications Inc.'s effort to buy Time Warner Cable Inc. The Wall Street Journal reported Friday that Comcast is leaning strongly toward working with Charter to buy some of Time Warner Cable's systems such as New York, as opposed to making its own stand-alone bid for the company. The deal would be predicated on Charter being successful in its bid to buy Time Warner Cable, and Comcast wouldn't put in money upfront to fund Charter's bid.

A person familiar with the matter said Monday that Comcast also isn't likely to involve itself in any Charter-led proxy fight if Charter chooses to nominate a slate of directors to Time Warner Cable's board. Overall, Comcast reported a fourth-quarter profit of $1.91 billion, or 72 cents a share, up from $1.52 billion, or 56 cents a share, a year earlier. Excluding tax adjustments and other items, adjusted per-share profit grew to 66 cents from 52 cents. Revenue grew 6.2% to $16.93 billion. Analysts surveyed by Thomson Reuters projected an adjusted profit of 68 cents a share on $16.63 billion in revenue. At the company's cable business, which accounts for the bulk of the top line, revenue increased 5.2% to $10.66 billion.

Comcast added 379,000 broadband subscribers in the quarter, compared with 341,000 a year ago, boosting its broadband revenue 8.7%. Broadband has been a major growth area for cable operators in recent years, helping offset the video declines. Also in the latest quarter, Comcast's business services revenue jumped 25%.

At Comcast's NBCUniversal, operating cash flow-a measure of profitability-improved 14% to $1.34 billion. A big driver of that growth was the broadcast-TV segment, home of the flagship NBC network, whose operating cash flow rose 55% on a nearly 12% jump in revenue. Filmed entertainment was also another major driver, as its operating cash flow rose 127%. Cable networks' operating cash flow grew 3.8%. The theme-parks division posted a 4.6% jump in operating cash flow. Total revenue at NBCUniversal increased 7.5% to $6.46 billion. Comcast's Class A shares, up 33% over the past year, rose 3% in early trading Tuesday. Wall Street Journal; more from Bloomberg

KINBER, a nonprofit that provides technology for education services, has named Gwendolyn L. "Wendy" Huntoon as its new executive director. State-College-based KINBER - which stands for the Keystone Initiative for Network Based Education and Research - fosters collaboration through technology by delivering broadband services to nonprofits via the Pennsylvania Research and Education Network, or PennREN, a 1,600-mile fiber-optic network across Pennsylvania.

Huntoon's previous position was as director of advanced networking at the Pittsburgh Supercomputing Center, a research department at Carnegie Mellon University, where she provided leadership, management and administrative support for all the PSC's production and research network infrastructure and technologies. She directed the group's research on network performance and analysis. In addition, she oversaw the Three Rivers Optical Exchange, a high-speed network hub through which PSC's networking group provides high-performance networking for research and education for 18 organizations. "I am honored and excited to lead KINBER," Huntoon said in a news release. "Working in regional networking in Pennsylvania has been a passion of mine since joining the Pittsburgh Supercomputing Center in 1989, and I will dedicate my energy to forging partnerships, enabling access and maximizing the power of PennREN for the benefit of communities across the commonwealth." Huntoon was chosen after a six-month national search, according to a news release. Her first day will be Feb. 13. Central Penn Business Journal (Harrisburg)

DirecTV and Dish Network Corp, the largest U.S. satellite TV providers that usually compete for customers, announced on Monday that they have joined forces to sell customized ads in a bid to gain a slice of $3.4 billion political ad market dominated by local broadcasters. Both companies have been in a push to sell so-called addressable ads, which are targeted to their subscribers, based on data about their households.

Technology to deliver customized ads is widely used online by companies such as Google and Facebook Inc, but is only now starting to be offered by TV operators. The technology allows for the companies to send one commercial to a 50-year-old swing voter in Florida, while a neighbor would be beamed a different commercial at the same time even if both people were watching the same program. Dish's chief commercial officer Dave Shull said the companies could start selling spots as soon as February in the lead up to the midterm elections in November. Individual political campaigns would provide the third-party data on the people to target. The companies will have a joint sales force in Washington.

The companies have said the data they will use is kept anonymous and aggregated, which blocks them from connecting a name and address with specific details about a household, and that customers can opt out from receiving targeted ads. DirecTV's chief marketing and revenue officer Paul Guyardo said the companies have the ability to target small or large groups out of a pool of 20 million households, which could be useful to gubernatorial campaigns or ballot initiatives. Shull said satellite companies have an edge over cable companies, which offer similar technology, because the satellite providers have a national user base. He said they can target state by state while cable companies have regional systems that may not cover an entire state.

Dish and DirecTV said they would consider partnering with cable companies if it means they can reach a larger base. The satellite companies' agreements with the TV networks allow them to intercept and replace an average of two minutes of cable commercials every hour with its ads on popular networks such as Walt Disney Co's ESPN. Both companies declined to give projected revenue figures for the venture but said they both expect a "material" boost to their ad sales businesses, which was an incentive to put aside their differences as arch rivals. "We do compete a lot but we felt we could put a structure in place that had very significant upside in terms of the financial return to both companies," Dish's Shull said. S&P Capital IQ analyst Tuna Amobi said in a research note on Monday that he doesn't expect the venture to be a major revenue contributor at the beginning or to be a serious challenge to TV broadcasters, but added that he sees potential long-term gains. Reuters

Katie McGinty says she'll be the first prospective Democratic candidate in a big field seeking to challenge Gov. Tom Corbett to air a TV ad. McGinty said her first ad will run Tuesday night on CNN and MSNBC, sandwiched around television coverage of President Barack Obama's State of the Union address. She says the ad will run 30 seconds, but she's not saying how much she's spending on it. She's a former environmental adviser to the Clinton White House and ex-Gov. Ed Rendell. McGinty says her campaign raised $2.4 million last year. Including her, four Democratic candidates collectively say they marshaled about $28 million before Jan. 1 for the campaign. The primary election is May 20, and the deadline to file petitions to get on the ballot is March 11. Associated Press