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Cable Technology Feature Article

May 02, 2012

Comcast Sees Big Hike in First Quarter Earnings

By Steve Anderson, Contributing TMCnet Writer

It was a terrific first quarter for Comcast (News - Alert), who saw earnings spike from the first quarter of 2012 almost 30 percent in the wake of profitable Super Bowl advertising purchases, and their increasingly popular broadband internet service.

Analysts expected Comcast's first quarter revenue to be $14.4 billion, but Comcast beat those estimates by a healthy margin, posting instead $14.9 in revenue, an increase of 9.6 percent from a year ago. And while revenues were up a good bit, so too were profits.

The various divisions involved in Comcast, including a majority stake in NBC Universal (News - Alert), also bore fruit with NBC Universal – which represents about a third of Comcast's revenue – showing a 17 percent increase in revenue through new, surprisingly popular shows like "The Voice." Universal Studios also saw a good jump from unexpected theatrical successes "Safe House" and "Dr. Seuss' The Lorax."

Even Comcast's cable business revenue saw growth at 5.7 percent from last year. Comcast CEO Brian Roberts even figures his company can reverse the growing trend of cable cutting, as viewers flock to satellite, phone company and online sources, but he'll have quite a way to go to get there – especially since Comcast reportedly lost 37,000 subscribers last quarter, closely matching the number of losses they'd posted in the same quarter last year.

But with new products in the offing, like their recently-released Streampix, a video-streaming service comparable to Netflix – and an extra 439,000 Internet subscribers in the last quarter – there is clearly more impetus to growth than, as some believe, higher fees alone.

And if Comcast can win back viewers with more services, it will certainly be a better win for them than the attempt to cut off streaming video services like Hulu (News - Alert) at the knees.

Streaming video has always been something of a trouble spot for cable providers like Comcast, who fear they will be reduced to "dumb pipes" providing a simple utility, much like an electric or water company, and lose out on a large sum of potential revenue for which content provision allows.

Offering their own streaming alternatives is an excellent response, giving the entire market room to operate, and allowing customers the ability to find some of what they want in one place, and more of what they want in others. For instance, try finding television shows from the 1980s. It's not an easy venture, even considering the array of streaming solutions currently available. There's plenty of room in the market for competitors, without stepping on any toes.

More customer choice is always better for the market. We’ll see more and better services, more profit for all, and satisfaction for the customer.

Edited by Braden Becker

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