Cablevision CEO: Online-Only Video Services Not Necessarily Disruptive
James Dolan also says Verizon, whose FiOS service competes with Cablevision, is "pursuing the destruction of their own capital"
Cablevision Systems CEO James Dolan said Thursday he feels no urge to jump in and join the recent push towards online-only, or over-the-top, video services.
"At the moment, we are starting to see quite a significant number of suppliers [moving] into this direction," he said on his company's earnings conference call in an apparent reference to HBO and CBS announcements of online-only services and Sony's and Verizon's plans to launch virtual pay TV operations. "When you look at their pricing, they are priced significantly above what we charge the consumer for them. So, I don't know that it's necessarily disruptive to us yet as a multi-channel provider, but we're keeping our eye on it."
He added though: "Ultimately, cord cutting and going to over-the-top is something that we do believe is going to happen, and we're preparing ourselves for it." Executives at Charter, Comcast and other cable firms have also been asked about the topic this earnings season.
Asked about his interest in going outside Cablevision's service footprint via a virtual pay TV provider like Sony and Verizon are each planning, Dolan said he isn't interested. "We have no intentions of going outside of our footprint with anything like over-the-top at the moment," he said. "I'm not sure…how valuable of a business it is going to be. We don't really know yet. I don't see it as being something that would be a strategically significant move on our part."
He was also asked about competition from Verizon and its FiOS service, which has long been offered in Cablevision's markets. "Verizon, in our opinion, continues on a path of pursuing the destruction of their own capital," Doland said.
He said he doesn't think the company is profitable "on any level" in Cablevision's service area. "I don't think they are profitable. They just rapidly pursue us in an attempt to try and get customers," he said.
Dolan said his team is "giving them all the customers that we think are the most expensive customers and the ones that provide the least free cash flow to us." He said analysts could see that in Cablevision's results.