Cablevision Q3 Profit Triples, Analyst Credits Free WiFi
Posted by Jesse Ward on Monday, November 9, 2009 · 
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Cablevision Systems announced last week that its third-quarter profit more than tripled as the number of customers using its voice phone service surpassed 2 million.
The cable TV operator earned $98.9 million, or 33 cents per share, for the period ended September 30. That’s up from $30.9 million, or 10 cents per share, a year ago.
Revenue grew 5% to $1.84 billion from $1.75 billion in what is typically the slowest quarter of the year for Cablevision, assisted by higher cable TV rates. The number of new digital cable TV customers rose by 2.6% from last year, while basic cable TV subscribers fell 1.5%. Cablevision signed up 4% more new Internet customers and 10% more new phone customers.
The results exceeded analysts’ expectations, and prove that Cablevision is holding its own against Verizon’s FiOS TV, a competitive service offered in 36% of Cablevision’s market.
Craig Moffett, senior analyst at Sanford Bernstein, said free Wi-Fi is a compelling reason for customers to stick with Cablevision over Verizon.
Back in August 2008 Cablevision announced that it would build a WiFi network across its entire operating region, including New Jersey, Connecticut and New York. Cablevision currently provides Wi-Fi access to subscribers at train stations, and plans to offer the service inside venues such as its Madison Square Garden arena, Radio City Music Hall, malls and airports. It’s also bidding to build a Wi-Fi network on New York and New Jersey trains.
”Perhaps it’s time to start giving Cablevision’s free Wi-Fi network some of the credit,” Moffett said in a research note. ”For all of its vaunted capabilities in wireless, free wireless broadband is something that Verizon Wireless simply can’t match.”
The company said its estimated $300 million cost to roll out Wi-Fi is running 15% under budget, not bad for a seemingly sticky service.
View the release.
Read more about CableVision’s WiFi plans.
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