Maybe the sky is not falling...
Comcast just announced its earnings and a net increase in video subscribers of
89,000 for Q415; but for the year they lost 36,000 video subscribers while
gaining 410,000 broadband subscribers. As a percentage, Comcast lost one tenth
of one percent of its video subscribers. At year end Comcast has 22.3 million
Another way to look at this is to compare the number of subscribers Comcast had
in 2007 versus the end of 2015. In 2007 they had 24.8 million video
subscribers. Thus a loss of 2.5 million subscribers or 10% over the past 8
Comcast had 23.3 million broadband subscribers at the end of 2015; at the end
of 2007 they had 13.6 million subscriber. Obviously this is a huge increase,
and video streaming may be a factor. But there does not seem to be much
correlation with the loss in video subscribers, especially since the decline in
video subscribers appears to be slowing...at least for now.
To put all of this into perspective, the market for PCs declined 10.6% in 2015
to a total of 288.7 million. Total shipments were below 300 million for the
first time since 2007. The PC market peaked in 2011 at 352.8 million; the
decline since 2011 is roughly 18%.
As Bert likes to say, it is informative to look at the trends...
Comcast shrugs off years of cord-cutting losses, adds 89K TV customers
Comcast has been steadily losing cable TV subscribers for years, but it turned
things around in the most recent quarter by adding 89,000 video customers.
The 89,000 net additions in Q4 2015 was Comcast's best result on the video
subscriber front in eight years, according to today's earnings release. Comcast
did lose 36,000 video customers over the entire year, but even that was "the
best result in nine years," Comcast said.
The broadband business continued to boom, meanwhile, with net additions of
460,000 in the quarter and 1.4 million for the year. Overall, Comcast now has
22.3 million video customers, 23.3 million Internet customers, and 11.5 million
phone customers. The phone business added 139,000 subscribers in the quarter
and 282,000 during the full year. Many of the additions came from existing
customers adding a service. Comcast's total customer base increased by 281,000
in the quarter and 666,000 in 2015 for a new total of 27.7 million.
Comcast ended the year 2007 with 24.8 million video subscribers and 13.6
million Internet subscribers. The split between TV and broadband customers has
undergone a major shift since then as high-speed Internet has become more
essential and online video services have proven good enough for some customers
to ditch cable TV. Comcast's data caps are low enough that replacing cable TV
with Netflix or other services might be difficult, though, and there is still
lots of programming, including live sports, that is exclusive to pay-TV.
Comcast Internet revenue grew 10.2 percent in 2015 and was $12.5 billion for
the full year.
While Internet access has become Comcast's most popular service, cable TV
remains a bigger moneymaker, and the revenue is growing as the nation's largest
cable company continues to get more revenue from each subscriber. Comcast's
full-year video revenue rose from $20.8 billion in 2014 to $21.5 billion in
2015, an increas
e of 3.6 percent, even though Comcast lost 36,000 video subscribers on the year.
The amount Comcast pays for video programming is rising even faster, though,
with a 7.1 percent increase in 2015. Comcast has consistently blamed
programming costs for bill increases passed along to TV customers. Comcast also
benefits from programming fees, though, because it owns NBCUniversal, various
regional sports networks, and other programming.
Total company revenue, including NBCUniversal and all other businesses,
increased 8.3 percent in 2015 to reach a full-year total of $74.5 billion.
Operating income grew 7.3 percent for a full-year total of $16.0 billion.
Comcast remains #1 in the US in total broadband connections, but it recently
lost its place as the top pay-TV provider when AT&T purchased DirecTV. AT&T was
able to increase the number of DirecTV subscribers from 19.6 million to 19.8
million in the most recent quarter, but losses in U-verse TV were bigger than
the DirecTV gains. Overall, AT&T now has 25.4 million video subscribers after
losing 26,000 in the quarter.
AT&T's total wireline Internet connections dropped by 36,000 to 14.3 million,
as losses in DSL exceeded gains in AT&T's faster Internet offerings.
Time Warner Cable, the third-largest pay-TV provider, also grew its video
subscriber base in Q4 2015. After adding 54,000 video customers, TWC now has
10.8 million. TWC added 281,000 Internet subscribers to boost that total to