July 1, 2010

MSO of the Year: Cablevision

Disregard the drama of previous years surrounding Cablevision’s ownership. Forget, also, its tight-lipped policy toward the press. The MSO’s numbers demand attention. Cablevision’s penetration, retention and subscriber growth continue to outpace its peers, which is no small feat considering it operates in the highly competitive NY area.

Its 63.3% basic cable penetration is the highest in the industry and well above the 47.5% average for the top ten MSOs, based on Leichtman Research Group data. Internet and phone penetration are well above the norm, too.

Also our ’06 MSO of the Year, Cablevision has an advantage in that it’s operating one system to serve its 3mln+ NY subs. That’s helped the numbers, but so has its long-term strategy, says Leichtman Research Group head Bruce Leichtman.

"A lot of this is not about 2010, but what you were doing [a decade ago]," Leichtman says. "Upgrading the system and the channel capacity, offering broadband and getting ready to offer phone. Doing that early has a tremendous effect. And now they run it in a disciplined fashion," he adds.

That early innovation continues to make it presence felt, says Will Richmond, VideoNuze.com analyst and a long-time cable industry follower. "Cablevision has continued to push the envelope, whether on broadband speeds, creating online video and TV apps, and rolling out new online-only content services," he says.

The company lost 40,000 basic video subs over the last year, but offset those losses handily with 58,500 new digital video subs, 125,000 new broadband customers and 165,000 new phone customers, for a total of 311,000 new revenue generating units, according to Cablevision data.

To keep existing customers, the operator is extending its broadband reach via the Wi-Fi rollout it began last year. Under that project, Cablevision is introducing Wi-Fi in its service area in downtowns, train stations, parking lots and other public places.

"Cablevision has been successful in a competitive market because we have maintained a strong focus on delivering unbeatable quality and value to our customers, who have responded by making our products the most highly-penetrated in the industry," says John Bickham, Cablevision’s President of Cable and Communications.

Next question: Will the one-system strategy play out of town? Cablevision announced plans to acquire 300,000-sub Bresnan, which has systems in Colorado, Utah, Wyoming and Montana. The industry will watch closely to see if Cablevision can apply its New York rigor to a more widespread market.