Comcast Cable Head Unveils 'House of Cards,' Sony Film Deal

Neil Smit
Neil Smit
 Newscom

Comcast plans to hit the ground running if and when its planned acquisition of Time Warner Cable is approved and closes, Neil Smit, president and CEO of Comcast Cable, told an investor conference Monday. Speaking at the Deutsche Bank Media, Internet & Telecom Conference in Palm Beach, Fla., he also touted the continued growth of Comcast's early-release electronic sell-through service.

Smit said that after Comcast recently agreed to add Warner Bros. film and TV shows, it has now added Sony content under a Monday morning deal. Comcast already had content deals with Fox, Lionsgate and its own NBCUniversal.

Under its content deals, Comcast typically has the right to sell titles "several weeks" before they are available on DVD and VOD, according to Smit. The executive said the electronic sell-through offer was launched based on an idea by NBCUniversal CEO Steve Burke, announcing this as one key advantage of the content and cable firms being under the same roof.

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The Sony deal includes American Hustle and Captain Phillips, among others. AMC hit series Breaking Bad , the first season of House of Cards and other library content will also be available, he said. Sony handles home entertainment deals for the Netflix original series.

The Xfinity On Demand digital store will roll out the Sony content over the coming weeks.

On Monday, Smit, whose appearance was webcast, also said that he has recently spent some time with TWC executives, and he felt the companies had similar future plans, which would make the combination and integration easier.

"Where we tend to differ slightly is we focus more on the triple-play bundle," Smit said. "Generally speaking, we are very well aligned."

Comcast, the largest U.S. cable operator, recently agreed to acquire second-largest cable firm Time Warner Cable in a $45 billion deal. Comcast, which also owns entertainment conglomerate NBCUniversal, has said it plans to sell cable systems with about 3 million subscribers, but it hasn't detailed which ones.

How quickly can Comcast bring TWC's operations to its financial and operational standards? "Some markets we will go into more aggressively," Smit said. "We intend to go in at a fairly quick rate" and go all-digital, boost broadband speeds and roll out new services without many delays. "I would like to see a lot of the initiatives rolling out in the first year," he said, while Comcast has said that full financial synergies will materialize over three years.

Asked about cost synergy opportunities, Smit said he targets operational overlap, operating synergies and programming spending savings, which he reiterated as a minority factor. He also said that revenue synergy potential is bigger than cost savings, although Comcast conservatively hasn't assumed any such benefits.

Among revenue upside is the sale of additional services, for which sales reps will get additional training, he said. Advertising revenue with the merged entity's bigger reach will also have upside potential, according to Smit.

Charter Communications -- in which John Malone's Liberty Media owns a 27.3 percent stake and which had also stalked TWC -- Cox Communications, Cablevision Systems and smaller cable firm Suddenlink are all considered potential bidders for those systems that Comcast will sell after the TWC deal. Malone has been vocal about the cable industry's need to consolidate.

Earlier in the conference day, Verizon CFO Fran Shammo said that the telecom giant wasn't concerned about the proposed Comcast-TWC merger, given that it already competes with both. "I'll just compete against Comcast tomorrow," he said. "We're ready to compete."

Shammo reiterated recent Verizon comments that the telecom firm was looking to reach a streaming deal with Netflix similar to one Comcast recently struck.

"We're in talks with Netflix," he said. "We're very comfortable with where we are." He didn't signal when a deal could be reached.

E-mail: Georg.Szalai@THR.com
Twitter: @georgszalai

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