CSG Systems tightened its ties to Comcast Thursday with word that it will add about 2.3 million Comcast residential subs to its billing platform in “early 2015,” with the opportunity to add more to the pot “as part of any future consolidation or standardization.”
The revised deal, which runs through June 30, 2019, expands and extends CSG’s relationship with Comcast
But what’s good for CSG appears to be less so for Comcast’s other residential billing vendor, Amdocs.
CSG has been handling billing needs for two-thirds of Comcast’s residential subs, with Amdocs taking care of the remaining third. The 2.3 million additional subs migrating to CSG doesn’t clear Amdocs completely from Comcast's residential billing picture, but it’s still a significant reduction.
While the new CSG/Comcast deal “provides a framework for Comcast to consolidate its residential business onto CSG’s billing solution,” Comcast has not announced when or if it might execute on that provision. But it will help Comcast bring more unity to its operations.
“CSG has been a great partner and this new agreement will help us provide more consistent customer interactions by creating opportunities to standardize and streamline our back-office operations,” Comcast chief information officer Scott Alcott said, in a statement.
And the heavier billing reliance on CSG could help Comcast in other ways down the road, particularly if it’s successful in acquiring Time Warner Cable. In January 2013, CSG and TWC inked an extension for customer care and billing that’s good through March 2017.
Amdocs and Comcast inked a multi-year deal in February 2012 that included an extension of an existing software license and service agreements with Amdocs tied to offerings in the Amdocs CES (customer experience systems) portfolio. Comcast confirmed that it continues to use Amdocs in areas beyond residential billing, and that the new deal with CSG does not impact that work.
The new deal with Comcast didn’t offer much help to CSG shares on a day in which the entire market got smacked around, as the Dow dropped 1.88%, and Nasdaq dipped 2.09%. CSG closed Thursday down 57 cents (2.14%) to $26.04 each on Thursday.
Also on Thursday, CSG posted second quarter revenues of $184.6 million, down 1% year-on-year, due in part to two business divestitures completed in the second half of 2013. Non-GAAP EPS for the second quarter of 2014 was 52 cents, compared to 57 cents in the second quarter of 2013, and 52 cents for the first quarter of 2014.