The growth came not so much from customer adds as from higher average revenue per user – in other words, subscribers increased their at-home entertainment as the recession continued.
Philadelphia-based Comcast, the largest cable operator in the United States, earned $944 million, up from $771 million during the year-ago period. Revenue also rose 3 percent to $8.8 billion, just missing the $8.85 billion analysts polled by Thomson Reuters had predicted. Comcast also, unlike many of its peers, showed more free cash flow, up 20 percent to $1.1 billion. That’s uncommon for the cable TV industry, which tends to operate under the weight of billions of dollars of debt.
Comcast said it added 1.1 million of the lines that provision its Internet, cable TV and phone services. In addition, video subscribers paid 3 percent more for service than they did last year, boosting Comcast’s overall video revenue to $4.78 billion. Digital phone and Internet revenue also grew, to $829 million and $1.93 billion, respectively.
Now, one month into the fourth quarter of 2009, Comcast is working on a high-dollar deal that will impact its fourth-quarter earnings, although it’s unknown to what extent. Comcast wants a 51 percent stake in NBC Universal, the entertainment and media conglomerate owned by General Electric. The move would catapult Comcast to the top of the heap among cable providers trying to capitalize on the growing Web TV movement. Cable operators are slowly losing eyeballs to free Web streaming of television shows; their challenge is to figure out how to work with the Internet or risk folding, not unlike the plight of many newspapers around the world.