Tuesday, April 22, 2014

Comcast Sees No Cord Cutting

While other cable operators have seen subscribers drop video service for OTT, Comcast seems to have bucked the trend.  For the second straight quarter, video subscriptions actually rose for the company.  "Comcast added 24,000 TV customers in the quarter to reach a total of 22.6 million."  In addition, Comcast added "383,000 broadband subscribers in the period to a total of 21.1 million."  They continue to defy analysts who expected cord cutting to take a bigger bite. 

Comcast has followed a differential strategy that continues to work.  Where cable operators have been separating their content companies from their platform companies (Time Warner Cable as an example), Comcast has embraced both content and distribution.  Its acquisition of NBCUniversal from General Electric has led to enormous gains as well.  They have proved that a content and distribution company can find synergies to work together.

Their planned acquisition of Time Warner Cable also demonstrates that size matters.  To offer best services, economies of scale and efficiencies come from size.  And a cable and broadband and content company, they seem to recognize that businesses change and adapt over time.  Like Apple's willingness to forgo iPod sales for iPhones, Comcast seems to understand that the cable world may change significantly and they must continue to readjust to meet the changing customer needs.  So far, it seems to be working well for them. 

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