June 19, 2020
The NBCUniversal Peacock streaming video service can’t come fast enough. Comcast Cable is expecting the same quarterly pay-TV subscriber loss in the second quarter (ending June 30) as it had in Q1: more than 388,000 subscribers dropping service.
That’s the projection Comcast Corp. CFO Michael Cavanaugh revealed June 16 during the virtual Credit Suisse Communications Conference.
“We’ve seen a lot of consumption of television, but a continued shift to streaming,” Cavanaugh said. “Our expectation is that the amount of spread [pay-TV sub losses] year-over-year will be about the same in the second quarter versus a year ago as it was in the first quarter.”
Cavanaugh said the sub loss isn’t a surprise in light of ongoing consumer migration toward over-the-top video from the traditional cable bundle. He said the previous business model around channel bundles has been supplanted by high-speed Internet, data and video distribution.
“Today, we look at video as important because it’s a customer need and because we’re the broadband provider … helping in an ever more streaming world and helping customers navigate the video that they choose to buy,” he said.
Cavanaugh said the days of forcing consumers to purchase bundles of content they may not watch are over.
“We’re not going to force it upon you if you don’t choose to see it that way,” he said.
To quell pay-TV drain, Comcast, through its cloud-based Xfinity platform, has pushed toward melding linear TV offering with over-the-top distribution such as Xfinity Flex, which enables subs to stream more than 10,000 free movies and TV shows, access services such as Netflix, Amazon Prime Video, HBO and Showtime, and rent or purchase movies and shows.
NBCUniversal launches its subscription/ad-supported Peacock streaming service nationwide on July 15.
“With impact on cord cutting, where we’re going with Flex in the cable business,” Cavanaugh said. “When combined with a voice remote, we think its very powerful, a platform attached to the broadband product.”
“I think there are a lot of pieces of our pre-existing [pay-TV] strategies and the momentum we had going into all this that I think is making us feel pretty confident in the future.”
Comcast reports Q2 results on July 30.