Verizon Communications is now roughly as big a video provider as Cablevision Systems, with the telco topping 3 million FiOS TV subscribers in the first quarter of 2010.
Still, FiOS's rate of growth has slowed down, compared with early 2009 levels. In the first three months of 2010, Verizon added 185,000 net new FiOS Internet customers and 168,000 net new FiOS TV customers -- down from 298,000 and 299,000, respectively, in the first quarter of 2009.
AT&T, which has a larger footprint than Verizon, is now growing faster on the video front. On Wednesday, AT&T reported that it has signed up about 2.3 million U-verse TV subscribers, more than three-fourths of whom have a triple- or quad-play.
FiOS TV remains bigger, though, ending the quarter with 3.0 million FiOS TV customers. Cablevision, by comparison, had 3.06 million basic video subs as of the end of 2009. Verizon's total broadband connections, including 5.7 million DSL and 3.6 million FiOS Internet subscribers, were 9.3 million (up 4.3% from the year-ago period). Verizon lost 95,000 DSL subs in the first quarter.
"Our first-quarter results were in line with our expectations, with solid growth in all strategic areas," Verizon chairman and CEO Ivan Seidenberg said in announcing the results. "Our first-quarter 2010 results show good customer and revenue growth in FiOS and at Verizon Wireless, cost-reduction initiatives that are on track, and a disciplined approach to capital investment -- all resulting in continued strong cash flow growth."
Total wireline broadband and video revenues were $1.7 billion in the quarter, up 22% percent from first-quarter 2009. That includes FiOS revenues, which grew approximately 40% year-over-year.
However, as usual, Verizon experienced an ongoing decline in legacy phone lines. Verizon had 17.9 million total residential access lines in service as of the end of March, down 11.9% versus the year earlier.
Overall, Verizon's total operating revenue was $26.9 billion in the first quarter of 2010, up 1.2% year-to-year. Net income attributable to Verizon plummeted 75% to $0.4 billion -- compared with $1.6 billion in the first quarter of 2009 -- largely attributable to a $962 million charge for reduced tax benefits related to retiree health care, according to the company.
Capital expenditures totaled $3.5 billion in the first quarter of 2010, down 6.8% from the year-prior period. Verizon reiterated its guidance that total 2010 capital spending will range from $16.8 billion to $17.2 billion.
Verizon Wireless, the joint venture with Vodafone, added 423,000 retail postpaid and 284,000 total retail customers in the quarter. The company had 87.8 million retail customers at the end of the first quarter, an increase of 4.4% year-over-year.