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Comcast Adds Just 65,000 New Broadband Customers In Q2
COO: Our marketing dollars went toward digital transition...

Comcast has unveiled their second quarter financials, indicating that the cable giant's earnings rose 53%. The company posted net income of $967 million, up from $632 million one year ago. While ad revenue for the company dropped some 20%, revenue from data and TV services more than compensated for the losses. While the company lost more than 214,000 basic video subscribers during the quarter, they added 250,000 digital video customers for a total of 23.9 million.

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The company added a surprisingly low 65,000 broadband customers during the traditionally sluggish second quarter, despite a slew of faster speeds and new promotion made possible by their speedy deployment of DOCSIS 3.0 technology.

According to Comcast COO Steven Burke, the slowdown is partially seasonal and recession-related, but also thanks to the fact that Comcast spent a significant chunk of their marketing budget pitching TV service to those impacted by the June 12 digital transition. The COO insists that numbers should improve as of July, when Comcast began dumping those marketing dollars back into attracting new broadband customers.

"We think we understand what happened and have already made some corrections," CEO Brian Roberts just told attendees of the company's earnings call. Those corrections likely won't include lowering prices, something the cable giant has traditionally avoided like the nastiest of plagues. If you recall, Roberts has likened cable broadband technology to a "BMW," while referring to DSL technology as a "Hyundai" -- and insisting BMW doesn't lower prices to suit "inferior" competition. It's not clear which metaphor represents FTTH in that equation.

While broadband growth may have been a bit off, the nation's third largest residential phone company continued to see strong VoIP growth, adding 233,000 VoIP customers on the quarter.
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pnh102
Reptiles Are Cuddly And Pretty
Premium Member
join:2002-05-02
Mount Airy, MD

pnh102

Premium Member

Saturation

There simply aren't many customers left who will buy Comcast's products at the price offered.

This should surprise no one.

N3OGH
Yo Soy Col. "Bat" Guano
Premium Member
join:2003-11-11
Philly burbs

N3OGH

Premium Member

Re: Saturation

Yeah, I tend to agree with that.

I think pretty soon Comcast is going to have to offer some discounts on their "BMW".

Besides, I have a friend who bought a new BMW a few years ago. I had always heard they were buggy, but WOW, what a piece of crap. Makes the electrical system of a '75 Plymouth look like the wiring on a nuclear submarine. Damn thing always needs some sort of repair.

DarkLogix
Texan and Proud
Premium Member
join:2008-10-23
Baytown, TX

DarkLogix

Premium Member

Re: Saturation

ya BMW is more about the name that about really being good

sure they're good right off the lot but I've heard bad things about then for a long time

Aston martin would be a better selection for the metaphor

Gbcue
Premium Member
join:2001-09-30
Santa Rosa, CA

2 edits

1 recommendation

Gbcue to N3OGH

Premium Member

to N3OGH
In the bay area, you can already get their non-HD triple play for $65.99 a month...

Of course add:
$9.99/mo HD fee
$4.99/mo/receiver receiver fee
$9.99/mo DVR fee (that can only be played back on the DVR TV)
$x.xx/6month price increase for no reason

and you're looking at a U-Verse price but with worse CS, picture quality, and internet reliability.

JasonOD
@comcast.net

JasonOD to pnh102

Anon

to pnh102
As long as they can keep reducing costs and increasing margins, they don't need new customers. The wind is still at their back, and some products, like digital voice (which likely has near 50% gross margins), has yet to saturate.

Comcast really dosn't have much to worry about short-mid term. The telco's are the most vulnerable, between the landline losses, inferior last mile woes forcing them to compete on price, and threats to their wireless division (network crushing iphones, android phones, and other 'multimedia' smartphones, and crap like google voice).

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Tale of the tape on 1 slide

Unless Comcast buys up some more smaller cable companies, their growth potential is definitely slowing down as this slide shows:
»phx.corporate-ir.net/Ext ··· PTM=&t=1


Karl Bode
News Guy
join:2000-03-02

Karl Bode

News Guy

Re: Tale of the tape on 1 slide

If I remember correctly they're also still facing that 30% FCC growth cap, though I don't remember if they successfully challenged that legally or not...
Samsonian
join:2007-06-15

Samsonian

Member

Re: Tale of the tape on 1 slide

said by Karl Bode:

If I remember correctly they're also still facing that 30% FCC growth cap, though I don't remember if they successfully challenged that legally or not...
Comcast successfully challenged it in 2001, but the FCC re-imposed it with a new, but still bogus arguments.

Comcast has been challenging it again. Comcast was supported by fellow cable companies (and potential M&A). Interestingly, Verizon supported Comcast in the case.

'http://www.broadcastingcable.com/article/209968-Comcast_and_FCC_Spar_At_D_C_Circuit_Court_of_Appeals.php'

Arguments at the D.C. Circuit Court of Appeals were in late April, and the judges sounded like they will strike it down again.

A decision could come anytime now.
caco
Premium Member
join:2005-03-10
Whittier, AK

caco to FFH5

Premium Member

to FFH5
On video side I would agree with you but penetration rates on cdv and chsi still leave a lot of room for gaining additional RGUs. My only concern is that if economy keeps up at current pace it will be extremely hard to find news customers who can afford to pay for services. Another concern is cdv and folks ditching home phone service entirely due to economy and going cell phone only and we have seen this happening already with telco landline losses. IMO home phone service is on a speeding path to be a free perk provided on top of regular internet service.
Corydon
Cultivant son jardin
Premium Member
join:2008-02-18
Denver, CO

Corydon

Premium Member

Re: Tale of the tape on 1 slide

I think you have to keep a close eye on the Clearwire rollout wrt home phone customers.

Once they get a critical mass there, I think it's only a matter of time before they offer a wireless device that (a) allows tethering and (b) offers their "home phone" service pretty much anywhere (which can run off the their VoIP/DECT6.0 service in the home and do VoIP over Clearwire everywhere else).

They're already working on integrating their services onto the home phone platform. It wouldn't be hard to transfer that experience to wireless once that is ready.
88615298 (banned)
join:2004-07-28
West Tenness

88615298 (banned) to pnh102

Member

to pnh102
You're right there aren't many people that don't have broadband that actually have access to it. The main reason for these people I suspect was price. These people aren't enticed by speed. It doesn't matter if the 16 mbs tier is the same price 12 Mbps was last year. These people have a certain price point in their heads and they aren't going to pay a penny more than that. Some people just won't pay more than say $20-$25 a month for internet and forcing people to have cable less they be charged an extra $10-$15 a month to get internet doesn't help either.

RR Conductor
Ridin' the rails
Premium Member
join:2002-04-02
Redwood Valley, CA
ARRIS SB6183
Netgear R7000

RR Conductor to pnh102

Premium Member

to pnh102
said by pnh102:

There simply aren't many customers left who will buy Comcast's products at the price offered.

This should surprise no one.
Unless there is no other choice for broadband, like where I live. The closest DSL is 8 miles away in Ukiah.

pnh102
Reptiles Are Cuddly And Pretty
Premium Member
join:2002-05-02
Mount Airy, MD

pnh102

Premium Member

Re: Saturation

said by RR Conductor:

Unless there is no other choice for broadband, like where I live. The closest DSL is 8 miles away in Ukiah.
Monopoly status is really a minor factor. If someone doesn't want broadband badly enough to pay $42.95 (or whatever Comcast charges) for it, said someone will simply do without it.

RR Conductor
Ridin' the rails
Premium Member
join:2002-04-02
Redwood Valley, CA
ARRIS SB6183
Netgear R7000

RR Conductor

Premium Member

Re: Saturation

said by pnh102:
said by RR Conductor:

Unless there is no other choice for broadband, like where I live. The closest DSL is 8 miles away in Ukiah.
Monopoly status is really a minor factor. If someone doesn't want broadband badly enough to pay $42.95 (or whatever Comcast charges) for it, said someone will simply do without it.
I was just saying areas like mine don't have a choice for broadband,.

DarkLogix
Texan and Proud
Premium Member
join:2008-10-23
Baytown, TX

1 edit

DarkLogix

Premium Member

Ferrari

"BMW," while referring to DSL technology as a "Hyundai" -- and insisting BMW doesn't lower prices to suit "inferior" competition. It's not clear which metaphor represents FTTH in that equation.

FTTH is the ferrari

kyler13
Is your fiber grounded?
join:2006-12-12
Annapolis, MD

kyler13

Member

Re: Ferrari

If cable is the BMW of broadband, then I'd liken FTTH to the Lexus of broadband. They're similar in offerings (even if not in capability), but one is much more reliable than the other.

DarkLogix
Texan and Proud
Premium Member
join:2008-10-23
Baytown, TX

DarkLogix

Premium Member

Re: Ferrari

ya but FTTH has more speed available (offered and that can be offered)

Lexus is just a high end toyota

kyler13
Is your fiber grounded?
join:2006-12-12
Annapolis, MD

1 recommendation

kyler13

Member

Re: Ferrari

said by DarkLogix:

ya but FTTH has more speed available (offered and that can be offered)

Lexus is just a high end toyota
"They're similar in offerings (even if not in capability)"

I was focusing only on the reliablity gap, which is large IMO. I don't think you can use Ferrari or other supercar manufacturers to get that point across. I'm aware of FIOS capabilities being greater, but to date, Verizon sits on a large portion of that capability, selling relatively meager speeds (for fiber) at higher prices than cable as if it might strain their extremely large pipe.

DarkLogix
Texan and Proud
Premium Member
join:2008-10-23
Baytown, TX

DarkLogix

Premium Member

Re: Ferrari

the way I see it is FiOS is currently like a Ferrari stuck in a school zone

for reliability just go with an old toyota truck (if you watch Top Gear you'll know what I mean)
competence
join:2004-11-24
123456

competence

Member

Comcrap needs to understand

Does Comcrap not understand that people just abuse them for their cheap promo offers....hell the only reason why I have comcast internet is because I get 6 months for $20 with 12Mbps down. When my 6 months is up then it is time to re-abuse the promo otherwise I would never use Comcrap.
67845017 (banned)
join:2000-12-17
Naperville, IL

67845017 (banned)

Member

Re: Comcrap needs to understand

I have to agree with this. I flip back and forth between cable companies for that very reason. To be fair though, CC has always given me attractive pricing when my promotions finsh and I call them up.

No one in my area offers anything comparable to the 50/10 D3 package, which may make me stay longer this go-around.
competence
join:2004-11-24
123456

competence

Member

Re: Comcrap needs to understand

Between Verizon because I'm close enough to the CO I can get 7.1mbps/768k-1mbps up and just switch back and forth. I can't wait to they finish up with FIOS so I can lock in!
67845017 (banned)
join:2000-12-17
Naperville, IL

67845017 (banned)

Member

Re: Comcrap needs to understand

Unfortunately FIOS will never be where I am now.

N3OGH
Yo Soy Col. "Bat" Guano
Premium Member
join:2003-11-11
Philly burbs

N3OGH to competence

Premium Member

to competence
said by competence:

Between Verizon because I'm close enough to the CO I can get 7.1mbps/768k-1mbps up and just switch back and forth. I can't wait to they finish up with FIOS so I can lock in!
My install date is next Thursday
competence
join:2004-11-24
123456

competence

Member

Re: Comcrap needs to understand

Rub it in more lucky :P. No, Seriously, congrats & enjoy

sivran
Vive Vivaldi
Premium Member
join:2003-09-15
Irving, TX

sivran to 67845017

Premium Member

to 67845017
Wish I could get such speeds. I want Comcast back, dammit.
67845017 (banned)
join:2000-12-17
Naperville, IL

67845017 (banned)

Member

Re: Comcrap needs to understand

Now how often do you hear that??!!

sivran
Vive Vivaldi
Premium Member
join:2003-09-15
Irving, TX

sivran

Premium Member

Re: Comcrap needs to understand

Probably a lot, from anyone who's on Roadrunner in a formerly-Comcast area.
67845017 (banned)
join:2000-12-17
Naperville, IL

67845017 (banned)

Member

Re: Comcrap needs to understand

Oh yeah, I should have realized that.

screavic4
Premium Member
join:2006-08-11
Paron, AR

screavic4

Premium Member

Could be 65,002

*Takes a rock and throws it to hit the cable*

That's how close it is to me, but a no go... Gotta love it, I know 2 for sure that would get it but the people in between would be more likely to get the basic packages.

Me I would be getting business internet package (need static IP) with digital voice/cable.

battleop
join:2005-09-28
00000

battleop

Member

Karl and Comcast must have made up :)

Another story that does not lead with an unrelated negative comment about Comcast. Nice.

•••
rob316
join:2005-10-17
Carteret, NJ

rob316

Member

I switched

You can add me as a new customer, I switched from Verizon phone & dsl to Comcast Blast & CDV. Save almost 20 bucks a month and 3 times faster then DSL.