Time Warner Shows Off


New York— Time Warner Cable officials last week helped set the stage for a planned future public offering of stock by emphasizing to investors the company’s revenue growth, new-service rollouts and state-of-the-art technology base.

With the second-biggest U.S. cable company coming off the best first quarter in its history — revenue rose 15%, cash flow was up 17% and basic subscriber growth was its best in six years — Time Warner Cable executives had a lot to highlight in presentations by chairman and CEO Glenn Britt, chief operating officer Landel Hobbs, chief technology officer Mike LaJoie, chief financial officer John Martin, executive vice president of product management Peter Stern and executive vice president of the Los Angeles region Roger Keating.

Britt stressed the past performance of the cable unit — 21 straight quarters of double-digit growth in monthly average revenue per subscriber — and assured the audience of investors and media analysts that pace can continue.

Hobbs said revenue generating units — a measure of basic, digital, high-speed Internet and telephone subscriptions combined — have nearly doubled in the past 12 months. Digital phone penetration — currently at 8% company wide — is more than double that figure in more-mature markets (23% in Portland, Maine; 18% in Albany, N.Y.; 17% in Binghamton, N.Y.; and 16% in Syracuse, N.Y.).

Stern extolled leadership in developing and rolling out new technology, ranging from the hybrid-fiber-coax architecture that has been adopted by every cable operator today to more-recent products like Start Over, which lets subscribers jump to the beginning of any show they turn to while it’s in progress.

As for future innovations, Stern said Time Warner Cable is working on a digital video recorder that includes a DVD burner.

LaJoie focused on the scalability of the HFC base, and said plans are in place to expand digital simulcasting and switched digital technology throughout the cable systems in the future.

This was the third time Time Warner has held an “investor day” but the first time one was devoted exclusively to Time Warner Cable.

The timing is crucial — Time Warner Inc. plans to spin off Time Warner Cable as a separate publicly traded entity after its joint acquisition (with Comcast Corp.) of Adelphia Communications Corp. closes, expected by July 31. With a new pure-play cable currency, courting Wall Street analysts is essential.