Angelakis: More Regulation Could Equal Less Investment

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Comcast chief financial officer Michael Angelakis warned regulators at an industry conference Wednesday that any attempt by the government to impose heavy restrictions on the cable broadband business could force companies to turn off the infrastructure investment spigot.
Angelakis speaking at the Barclay's Capital 2010 Global Communications, Media and Technology conference in New York, said that Comcast was disappointed that Federal Communications Commission chairman Julius Genachowski has opted to reclassify broadband as a Title II telecommunications service, which could open the business to more onerous restrictions. Genachowski has vowed to apply a light hand to broadband regulation, and Angelakis said the industry will have to take the chairman at his word.
But he said if the regulatory environment becomes "distressed," that could force cable operators, Comcast included, to curtail investment.
The Comcast CFO pointed to his company's Wideband efforts, claiming the Philadelphia MSO has more homes passed with the ability to receive 50 Megabit per second high-speed Internet service than all of the telcos and other cable operators combined.
"That is a meaningful investment we have made; a meaningful strategic decision we have made," Angelakis said.
"I think if the regulatory climate changes, our appetite to do those kind of things more could be negatively impacted. We will see how that plays out. Now I am optimistic that is not the case, but we will see."
Angelakis also addressed Comcast's pending NBC Universal joint venture - he expects regulatory approval by the end of the year - and added that investors should not hold their breath for another big deal.
Angelakis said that Comcast believes it has enough scale on the distribution side, so any system acquisition would have to pass an extremely rigorous set of criteria. On the business telephone side - Comcast recently purchased two competitive local exchange carriers (Cimco and NGT) for about $125 million combined - Angelakis said the same tenet holds true.
"Every banker in the country comes into Philadelphia and wants to sell us a CLEC, and it's ridiculous," Angelakis said. "We have no interest in really being aggressive on the acquisition side related to CLECs."
He added that the Cimco and NGT transactions help Comcast accelerate its entry into the medium-sized portion of small and medium-sized business. But he added that the focus is still to grow business services - currently generating about $1 billion in revenue per year - organically.