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Comcast just announced its second quarter results, and the cable giant now has more Internet service customers than cable TV customers for the first time.
Comcast reported 22.55 million Internet customers, compared to 22.3 million video customers. The cable giant reported losing 69,000 video customers in the quarter. By contrast, Comcast has picked up roughly 180,000 Internet customers.
Of course, the Internet service accounts overlap with the TV accounts because many Comcast customers buy both services in a bundle.
Selling Internet service has long been a higher margin business, and has been the line item that has kept cable companies’ balance sheets healthy.
The TV business, on the other hand, is more difficult. Cable providers are constantly being squeezed by video content owners (think local affiliates, Warner Brothers, Viacom, etc.) demanding higher and higher prices for video. On the other hand, cable companies are already facing the ire of customers over high cable prices, and are hard-pressed to recoup rising content costs by raising subscription prices.
Don’t expect cable companies to start pulling away from the TV business anytime soon, though. Revenue-wise it’s still the biggest line item on the page. Comcast video accounted for $5.24 billion in the quarter, compared to $2.8 billion in revenue from Internet service. But Comcast keeps far more of each dollar it makes selling Internet service than it does from each dollar of video service sales.
Hat tip: Engadget
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