Cablevision Does It Again

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Cablevision Systems continued to impress in the second quarter, reporting a gain in basic customers while reporting cable cash flow growth at nearly double the rate of its peers.
Revenue at the cable operations rose 6% to $1.4 billion and adjusted operating cash flow rose 12% to $620.6 million, twice the second quarter growth rate for larger peers Time Warner Cable (up 6%) and Comcast (up 5.4%). Cablevision also managed to increase basic subscribers by 2,900 (Time Warner Cable and Comcast each lost customers in the seasonally weak quarter), while continuing to add high-speed data (27,000), digital cable (21,000) and digital phone customers (25,000) in the period.
Company-wide, revenue was up 5.8% to $1.8 billion and AOCF rose 9% to $677.6 million.
On a conference call with analysts, chief operating officer Tom Rutledge also unveiled some new product initiatives that should contribute to continued strong performance.
Rutledge said that Cablevision is moving forward with its remote server DVR product and should begin rolling out the product to its entire footprint by the end of the year. Cablevision also is working on its own version of TV Everywhere, which would enable customers to access the full suite of TV products on any device that can receive TV content inside their home. Rutledge said that means customers will be able to watch TV on their IPads, Smart Phones and PCs inside their residences.
While the product seems similar to the TV Everywhere initiative being touted by Comcast and Time Warner, Rutledge said the main difference is in content rights.
Rutledge did not say when they plan to release the product, but added that a PC-to-TV application will see daylight in the fourth quarter.
Rutledge also said that previously announced tests for a voice service that would travel over the Wi-Fi network are moving forward. But he added that the company has nothing to announce.
Rutledge confirmed that its retransmission consent agreement with Fox Broadcasting expires in October, but he did not anticipate any major problems.
Cablevision had a messy retrans battle with The Walt Disney Co. in March - Disney pulled its ABC network from Cablevision for less than a day - that was ultimately resolved. Asked if Cablevision learned anything from that dispute, Rutledge said the main lesson from that dispute is simple.
"Every company is different," Rutledge said.

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