CEOs share cable connection
Comcast, TWC execs assign blame for sluggish Q2NEW YORK -- The two biggest U.S. cable operators, Comcast Corp. and Time Warner Cable, are seeing slowing and weaker-than-expected subscriber trends in the current second quarter, their CEOs said Friday.
They signaled that trends were more in line with the sluggish fourth quarter of 2008 than the stronger opening quarter of 2009. While the second quarter is traditionally a slower one for cable firms as students and others tend to move and disconnect service more, the executives said additional factors are playing a role -- one mainly blamed the bad housing market, while the other highlighted restrained spending by consumers amid recession and job fears.
The warnings come at a time when media executives at sector biggies have spoken of a stabilizing economy and advertising market.
Speaking at the Sanford C. Bernstein & Co. Strategic Decisions Conference here, Comcast chairman and CEO Brian Roberts suggested a lag between economic pain and its impact on cable customers. "There are less opportunities to sell new things right now," he said.
At the same conference, TWC chairman, president and CEO Glenn Britt said more people are moving back in with their families due to foreclosures. "If housing gets healthier ... there will be a subscription upturn," he suggested.
"It appears that high second-quarter foreclosures could eclipse the benefit of the (mid-June) digital (TV) migration," said Collins Stewart analyst Thomas Eagan in a research note regarding TWC Friday. Indeed, Britt said it is not yet clear how many new subscribers the June 12 digital-TV transition deadline could bring his company.
TWC shares closed down 3% at $30.79; Comcast's stock lost 2.6% to close at $13.