May 3, 2007

Put Them in a Blender

By Jim Barthold

As first quarter earnings announcements crop up like pollen just the week before the big cable bash in Las Vegas, it's time to play a little game of "Who said that?" Each of the following remarks was uttered during conference calls this week during earnings reports by executives from Time Warner Cable, Sprint Nextel, Insight Communications, Cablevision Systems and Verizon Communications. Guess which company's exec - it's a bit much to ask you to identify the exec - said what. And then think about how the cable show used to be all about HBO parties and Playboy bunnies and General Instrument and Scientific-Atlanta.

A. "This quarter followed our last quarter in showing how operational growth can and does grow financial growth in this industry. We added 24,400 telephone customers in Q1, which was by far our best quarter ever for telephone new adds."

B."Our ... business is increasingly centered on broadband, video and bundles. More broadband and video revenue, more customers on bundles, and strategic pricing changes all helped drive ARPU up $4.35 or 8.5 percent year-over-year."

C. "It caps off a year of behind-the-scenes work to be sure that the systems could ensure that the customer will have the best possible service experience. We are currently in 10 markets and expect to be in at least 40 markets by the end of the year."

D. "Bundling is key to driving great results. We have a lot more people in bundles where the video component is just one part of a much bigger bundle. We're really focusing on the prices of the bundle and not on any one component per se."

E. "At the end of the first quarter, 63 percent of new sales were three-product sales."

And the answers are - for those who didn't cheat and look here already ...

A. Dinni Jain, COO of Insight Communications, adding detail to what CEO Michael Willner called "the best quarter that this company has ever reported."

B. Doreen Toben, CFO, Verizon Communications who pointed out that "48 percent of our new FiOS Internet subscribers this quarter selected a minimum of 15 Mb or faster service from us. As we market our bundled services, we lead with FiOS TV."

C. Gary Forsee, president-CEO of Sprint Nextel, describing his pleasure with Pivot, the wireless joint venture with the cable industry. During the same call, though, in which company execs tried to explain away some slipping subscriber numbers, Forsee also pointed out, "We also continue to make solid progress toward the deployment of our WiMAX broadband network."

D. Landall Hobbs, COO of Time Warner Cable, who also announced that the nation's second-largest MSO will be rolling out a local-only telephone service later this year.

E. Tom Rutledge, COO of Cablevision Systems, who conceded that Cablevision, which further announced it would agree to be acquired by the Dolan family, has been impacted by Verizon's aggressive FiOS buildout.