ITV

Tag: business services

  • FY-2015: Time Warner Cable adds net video customers, revenue up 3.9%

    FY-2015: Time Warner Cable adds net video customers, revenue up 3.9%

    BENGALURU: This the first time since 2006 that Time Warner Cable Inc., (TWC) has reported year-over-year nett video subscriber additions. The company closed the year and quarter ended 31 December, 2015 (FY-2015, current year and Q4-2015, current quarter) with 10.821 million video subscribers, 32,000 (0.3 per cent increase) more than the 10.789 million at the close of FY-2014. The additions were made in Q4-2015, when the company added 54,000 subscribers, hence wiping out the fall of 22,000 until 30 September, 2015. In Q4-2015, TWC reported 10.821 million video customers as compared to 10.727 million in Q3-2015 (0.5 per cent increase).

     

    The company closed the current year with 681,000 more customer relationships than in the previous year. Total customer relationships at the end of FY-2015 and Q4-2015 were 15.129 million as compared to 14,511 million (4.3 per cent increase) at the end of FY-2014 and Q4-2015, and 14.929 million (1.3 per cent increase) in the immediate trailing quarter.

     

    Overall revenue and income

     

    The company reported 3.9 per cent growth in revenue in FY-2015 at $23,697 million as compared to $22,812 million in FY-2014. For Q4-2015, TWC reported 4.9 per cent YoY revenue growth at $6,072 million as compared to $5,790 million. Operating income in FY-2015 however declined 8.5 per cent YoY to $4,239 million as compared to $4,632 million in the previous year. Operating Income in the current quarter declined by 8.2 per cent YoY to $1,125 million as compared to $1,226 million.

     

    Company speak

     

    Time Warner Cable chairman and CEO Rob Marcus said, “I’m incredibly proud of everything we achieved this quarter and in 2015. We made our network more reliable, our products more compelling and our customer service better. And, importantly, our subscriber improvement over the last eight quarters, including our record subscriber performance in 2015, has begun to show up in our financial results. As we begin 2016, we intend to continue to improve the customer experience and build value for our shareholders.”

     

    Segment numbers

     

    Residential video: Residential video revenue in the current year declined 0.9 per cent to $9,907 million as compared to $10,002 million in the previous year. Video revenue in Q4-2015 increased 0.3 per cent YoY to $2,471 million as compared to $2,464 million in Q4-2014. Video Subscription numbers have been mentioned above.

     

    High Speed Data: High Speed Data revenue increased 9.3 per cent in FY-2015 to $7,029 million as compared to $6,428 million in FY-2014. For Q4-2015, the segment’s revenue increased 10.6 per cent YOY to $1,819 million as compared to $1,644 million in Q4-2014. High Speed Data subscribers in FY-2015 increased 8.6 per cent to 12.675 million as compared to 11.675 million in FY-2014. QoQ, relationships increased by 2.3 per cent as compared to 12.394 million in Q3-2015.

     

    Voice: Voice revenue declined 0.1 per cent in FY-2015 to $1,931 million as compared to $1,932 million in FY-2014. In Q4-2015, Voice revenue increased 5.7 per cent YoY to $497 million as compared $470 million. Voice subscribers increased 19.6 per cent in FY-2015 to 6.23 million as compared to 5.284 million in FY-2014. QoQ Voice subscribers increased 3.7 per cent in Q4-2015 as compared to 6.093 million in the immediate trailing quarter.

     

    Multi-Play: In FY-2015, while single play customers increased 2.2 per cent to 5.75 million from 5.63 million and triple play customers increased 21.9 per cent to 5.31 million from 4.356 million, double play customers declined 10.1 per cent to 4.067 million from 4.525 million in FY-2014. QoQ, Single play customers increased 0.8 per cent, triple play customers increased four per cent, while double play customers declined 1.2 per cent.

     

    Business Services: Business services contribution to TWC’s revenue increased to 13.9 per cent in FY-2015 from 12.4 per cent in FY-2014. Overall Business Services Revenue (BSR) in the current year increased 15.7 per cent to $3,284 million from $2,838 million in FY-2014. Total revenue in Q4-2015 increased 14.4 per cent YoY to $864 million (18 per cent of overall revenue) as compared to $755 million (16.4 per cent of overall revenue). A major portion (a little less than 50 per cent) of BSR comes from high speed data and almost 90 per cent of TWC’s business services subscribers opting for this service.

  • FY-2015: Time Warner Cable adds net video customers, revenue up 3.9%

    FY-2015: Time Warner Cable adds net video customers, revenue up 3.9%

    BENGALURU: This the first time since 2006 that Time Warner Cable Inc., (TWC) has reported year-over-year nett video subscriber additions. The company closed the year and quarter ended 31 December, 2015 (FY-2015, current year and Q4-2015, current quarter) with 10.821 million video subscribers, 32,000 (0.3 per cent increase) more than the 10.789 million at the close of FY-2014. The additions were made in Q4-2015, when the company added 54,000 subscribers, hence wiping out the fall of 22,000 until 30 September, 2015. In Q4-2015, TWC reported 10.821 million video customers as compared to 10.727 million in Q3-2015 (0.5 per cent increase).

     

    The company closed the current year with 681,000 more customer relationships than in the previous year. Total customer relationships at the end of FY-2015 and Q4-2015 were 15.129 million as compared to 14,511 million (4.3 per cent increase) at the end of FY-2014 and Q4-2015, and 14.929 million (1.3 per cent increase) in the immediate trailing quarter.

     

    Overall revenue and income

     

    The company reported 3.9 per cent growth in revenue in FY-2015 at $23,697 million as compared to $22,812 million in FY-2014. For Q4-2015, TWC reported 4.9 per cent YoY revenue growth at $6,072 million as compared to $5,790 million. Operating income in FY-2015 however declined 8.5 per cent YoY to $4,239 million as compared to $4,632 million in the previous year. Operating Income in the current quarter declined by 8.2 per cent YoY to $1,125 million as compared to $1,226 million.

     

    Company speak

     

    Time Warner Cable chairman and CEO Rob Marcus said, “I’m incredibly proud of everything we achieved this quarter and in 2015. We made our network more reliable, our products more compelling and our customer service better. And, importantly, our subscriber improvement over the last eight quarters, including our record subscriber performance in 2015, has begun to show up in our financial results. As we begin 2016, we intend to continue to improve the customer experience and build value for our shareholders.”

     

    Segment numbers

     

    Residential video: Residential video revenue in the current year declined 0.9 per cent to $9,907 million as compared to $10,002 million in the previous year. Video revenue in Q4-2015 increased 0.3 per cent YoY to $2,471 million as compared to $2,464 million in Q4-2014. Video Subscription numbers have been mentioned above.

     

    High Speed Data: High Speed Data revenue increased 9.3 per cent in FY-2015 to $7,029 million as compared to $6,428 million in FY-2014. For Q4-2015, the segment’s revenue increased 10.6 per cent YOY to $1,819 million as compared to $1,644 million in Q4-2014. High Speed Data subscribers in FY-2015 increased 8.6 per cent to 12.675 million as compared to 11.675 million in FY-2014. QoQ, relationships increased by 2.3 per cent as compared to 12.394 million in Q3-2015.

     

    Voice: Voice revenue declined 0.1 per cent in FY-2015 to $1,931 million as compared to $1,932 million in FY-2014. In Q4-2015, Voice revenue increased 5.7 per cent YoY to $497 million as compared $470 million. Voice subscribers increased 19.6 per cent in FY-2015 to 6.23 million as compared to 5.284 million in FY-2014. QoQ Voice subscribers increased 3.7 per cent in Q4-2015 as compared to 6.093 million in the immediate trailing quarter.

     

    Multi-Play: In FY-2015, while single play customers increased 2.2 per cent to 5.75 million from 5.63 million and triple play customers increased 21.9 per cent to 5.31 million from 4.356 million, double play customers declined 10.1 per cent to 4.067 million from 4.525 million in FY-2014. QoQ, Single play customers increased 0.8 per cent, triple play customers increased four per cent, while double play customers declined 1.2 per cent.

     

    Business Services: Business services contribution to TWC’s revenue increased to 13.9 per cent in FY-2015 from 12.4 per cent in FY-2014. Overall Business Services Revenue (BSR) in the current year increased 15.7 per cent to $3,284 million from $2,838 million in FY-2014. Total revenue in Q4-2015 increased 14.4 per cent YoY to $864 million (18 per cent of overall revenue) as compared to $755 million (16.4 per cent of overall revenue). A major portion (a little less than 50 per cent) of BSR comes from high speed data and almost 90 per cent of TWC’s business services subscribers opting for this service.

  • Q3-2015: US cable industry video slide continues; ARPU rises

    Q3-2015: US cable industry video slide continues; ARPU rises

    BENGALURU: Like in the previous two quarters and even earlier, the cable industry in the US continues to bleed video subscribers, albeit slower than before, while internet and business services (BS) continue to be growth drivers in terms of subscription numbers and revenue in the quarter ended 30 September, 2015 (current quarter, Q3-2015). This report considers three players for Q3-2015 – Comcast Cable Communications segment, Time Warner Cable and Charter Communications. Overall, YoY and QoQ subscription numbers or customer relationships of the three players in this report have increased, despite a fall in video customers.

    Comcast Inc., Cable Communications segment is the largest player by far among the sample players in this report; Time Warner Cable, Inc., (TWC), is a little less than half the size of Comcast’s Cable communications segment in terms of revenue and Charter Communications (Charter) with revenues that are less than half again as TWC’s.

    Despite the continued slide in video customer relationship, the combined sum of video subscribers in Q2-2015 of the three entities was about 3.72 crore or almost two thirds (61.4 per cent) of the 6.6 crore video subscribers through wire in the US as of 2013 numbers. The three players in this report are generally considered amongst the biggest players in the US cable television industry. All have three major revenue streams – Video, Internet and Voice (VIVE).

    Note: (a) 100,00,000 = 100 lakh = 10 million = 1 crore

    (b) While denominations for US$ have been mentioned in millions or billions where applicable, denominations for numbers have been mentioned lakhs and crores.

    (c) Residential customer relationship numbers have been used in this report wherever the breakup has been mentioned in SEC filings by the concerned entity. In the case Comcast Cable Communications segment, the breakup of subscription numbers in terms of Residential and Business Services has not been indicated.

    (d) The results and the conclusions in this report may not necessarily reflect the true trends and nature of the cable communications industry in US.

    Performance in Q3-2015

    In general, six streams add to most of the three entities’ revenue – three products – Video, high speed Internet, Voice; Business Services (BS); Advertising; and Other. Collectively, the first three have been given the acronym VIVE by the author. Generally VIVE numbers, be they subscription or revenue indicate residential subscribers and revenue from these subscribers in this report. This report examines VIVE and touches briefly upon BS of some of the players later on. It must be noted that BS revenue exceeds revenue from Voice services, but since voice is one of the three limbs of triple play, it has been mentioned along with Video and Internet.

    As mentioned above, in general, Internet has been driving growth, both in terms of revenue and subscription numbers. Contribution by BS is growing and is in low double digits in terms of percentage of overall revenue. Historically, over the previous two years, video revenues in Q3 of a year drop QoQ, before increasing in Q4 again. This has also happened in the current quarter Q3-2015. Due to the drop in video revenues, combined VIVE revenue has dropped QoQ in Q3-2015.

    Overall combined subscription numbers in Q3-2015 increased 0.82 per cent (increased by 397,000) QoQ to 485.52 lakh and increased by 2.78 per cent (increased by 1,315,000) YoY from 472.37 lakh. QoQ growth was driven by a growth in internet and voice subscribers and partly offset by a decline, albeit at a much lower rate, of video subscribers.

    In the current quarter combined Video Subscribers declined 0. 12 per cent QoQ to 371.57 lakh from 372 lakh and declined by 0.54 per cent YoY from 373.60 lakh. Combined high speed data subscribers in the current quarter increased 1.72 per cent QoQ to 403.54 lakh from 396.71 lakh and increased 6.88 per cent YoY from 377.55 lakh. Combined Voice subscribers in Q3-2015 increased 1.48 per cent QoQ to 199.80 lakh from 196.89 lakh and increased 8.30 per cent YoY from 184.48 lakh.

    The combined overall revenue (OR) of the three players in Q3-2015 increased 0.13 per cent (increased by $27 million) QoQ to $20,112 million from $20,085 million and increased 5.62 per cent (increased by $1070 million) YoY from $19,042 million. Please refer to Fig A2 below.

    Combined VIVE revenue in the current quarter declined 0.74 per cent (declined by $120 million) QoQ to $16,075 million from $16,195 million, but increased 4.2 per cent (increased by $648 million) YoY from $15,427 million. Video revenues of all the three players declined in this quarter as compared to the previous quarter. Internet revenues of all the three players increased, while Voice revenue of Comcast Cable Communications Segment and Charter increased. Voice revenue in the case of TWC declined QoQ in Q3-2015.

    Average Revenue Per User (ARPU) continued to rise as is evident from Figure A3 below, with Comcast Cable Communications ARPU at $143.12 in Q3-2015 being about 13 per cent higher than TWC’s ARPU of $126.92 and about 26 per cent more than Charter Communications ARPU of $113.39. This huge discrepancy reflects the fact that Comcast has a much higher proportion of multi-play (triple play and double play) customers when compared to the other two players. Please refer to Figure A4 below. While Comcast Cable Communications segment (A4-1 below) had about 31 per cent of single play customers, and 69 per cent multi-play (33 per cent of double play and 36 per cent triple play) customers in Q3-2015, in the case of the other two players (A4-2 and A4-3 below), single play customers totalled about 39 per cent and multi-play customers around 61 per cent.

    Business Services Revenue

    Combined Business Services Revenue (BSR) of the three entities increased 3.93 per cent QoQ to $2,330 million (11.59 per cent of combined Overall Revenue or combined OR) from $2,242 million (11.16 per cent of combined OR) and increased 17.20 per cent YoY from $1,988 million (10.44 per cent of combined OR). As has been mentioned, contribution by BSR to OR has been increasing – Combined BSR share of combined OR in Q2-14 was 9.99 per cent, in Q3-2015 it was 11.59 per cent.

    Please refer to figure B below. BSR has been increasing in absolute dollars as well as by way of contribution to OR. Amongst the three players in this report, BSR contribution has been the highest in terms of percentage of overall revenues in the case of TWC over the past six consecutive quarters considered in this report. Even in the case of Comcast Cable Communications segment, which had the highest BSR in terms of absolute dollars, BSR’s contribution has entered into double digits in terms of percentage of OR in the current quarter. While Comcast Cable Communications Segment break-up of residential and BSR subscription numbers is not available, Figure B1 below clearly indicates that TWC and Charter BSR subscription numbers have been increasing over time. 

  • Q3-2015: Time Warner Cable – residential Internet data ascend, video slide; Business Services numbers up

    Q3-2015: Time Warner Cable – residential Internet data ascend, video slide; Business Services numbers up

    BENGALURU: The slide in retail or residential video numbers continues for the US television cable industry, if one were to go by the numbers reported by Comcast Cable Communications division and now by Time Warner Cable Inc., (TWC) for the quarter ended 30 September, 2015 (Q3-2015). Data, or more specifically high speed data continues its juggernaut, climbing YoY and QoQ.  The company’s Business Services segment reported increase in numbers across all parameters.

    TWC’s consolidated revenue in the current quarter increased 3.6 per cent (increased by $208 million) to $5922 million from $5714 million in Q3-2014, but declined marginally (declined by 0.1 per cent or $4 million) from $5926 million in the immediate trailing quarter.

    Note: 100,00,000 = 100 lakh = 10 million = 1 crore

    Subscription numbers have been mentioned in lakhs and revenue and other financial numbers in millions of US dollars.

    Time Warner Cable chairman and CEO Rob Marcus said, “I’m very excited about the operating momentum reflected in our third-quarter results. Subscriber growth was the strongest in years; revenue growth accelerated; and we continued to make significant investments in our network, equipment, products and customer service. Our ongoing transformation is a testament to the strength of our operating plan and the commitment of our entire team – all 55,000 employees – who work tirelessly every day to make Time Warner Cable an even better company.”

    Residential numbers

    Customer relationships

    For Q3-2015, TWC has reported amongst the best subscriber numbers over a long time, and this improvement is reflected by the low drop in video numbers of only 7000 that the company has reported. Residential High Speed Internet Data (Data) and Voice customers have both increased YoY and QoQ basis. Voice has shown the largest YoY and QoQ growth in terms of number of subscribers as well as in percentage terms.  

    Overall, TWC’s total customer relationships (including business services) increased 3.3 per cent (increased by 472,000) in Q3-2015 to 156.63 lakh from 151.31 lakh in Q3-2015 and by 1.1 per cent (increased by 163,000) from 155 lakh in the previous quarter. Please refer to Fig A below.

    Residential or retail customer relationships improved to an all-time high of 149.29 lakh in the current quarter as compared to the 144.57 lakh in Q3-2014 or the 147.82 lakh in the previous quarter.  

    Business Services saw increase across all three plays, both YoY and QoQ. Business Services customer relationships increased 8.9 per cent (increased by 60,000) YoY to 734,000 in Q3-2015 from 674,000 in Q3-2014 and increased by 2.2 per cent (increased by 16,000) from 718,000 in Q2-2015.

    Video Numbers

    Please refer to Fig B below.

    Video revenue declined 1.8 per cent (declined $44 million) YoY in Q3-2015 to $ 2453 million from $2497 million and declined 2.4 per cent from $2514 million in the immediate trailing quarter. Video customer relationships declined 0.6 YoY to 107.67 lakh from 108.27 lakh and declined QoQ from 107.74 lakh.

    Within TWC’s Video segment, six products or sub-segments contribute to revenue. The major segment is Programming tiers, which contributed $1566 million or about 64 per cent to Video revenue and more than 26 per cent to TWC’s consolidated revenue in the current quarter. The other sub-segments are Premium networks ($216 million, about nine per cent of video revenue in Q3-2015); Transactional Video-on-demand ($45 million, about two per cent of video revenue in Q3-2015); Video equipment rental and installation charges ($362 million, about 15 per cent of Video revenue in Q3-2015); Digital video recorder service ($150 million, about six per cent of Video revenue for Q3-2015) and Franchisee and other fees ($114 million, about five per cent of Video revenue for Q3-2015).

    Except for Premium tiers and Video equipment rental and installation charges, revenue from all the other sub-segments declined both YoY and QoQ. 

    High Speed Internet (Data) numbers

    Data revenue increased 9.4 per cent (increased $152 million) in the current quarter to $1772 million from $1620 million in Q3-2014 and increased 1.7 per cent (increased $30 million) from $1742 million in the immediate trailing quarter.

    TWC’s Data customer relationships in the current quarter increased 7.7 per cent YoY to 123.94 lakh from 119.90 lakh and 1.9 per cent QoQ from 121.62 lakh, while voice customers increased 22.1 per cent YoY to 60.93 lakh in the current quarter from 49.89 lakh in Q3-2014 and by four per cent from 58.56 lakh in the previous quarter. Please refer to C below.

    Voice Numbers

    TWC’s Voice revenue increased 1.5 per cent (increased $7 million) to $483 million in the current quarter from $476 million in Q3-2014 and increased one per cent (increased by $5 million) in the immediate trailing quarter.

    Voice subscribers increased 22.1 per cent (increased by 1,104,000) to 60.93 lakh in Q3-2015 from 49.89 lakh in Q3-2014 and increased four per cent (increased 237,000) from 58.56 lakh in Q2-2015.

    Single Play, double play and triple play

    The company’s residential single play customer relationships have been slowly increasing over time. Single play relationships in the current quarter increased by 0.6 per cent (35,000) to 57.09 lakh YoY from 56.74 lakh and by 0.9 per cent (50,000) from 56.59 lakh. Please refer to Fig D below.

    Double play customers have been declining over time, with the decline steepening even further since Q3-2014. In the current quarter, double play customer declined YoY by double digits – 12.4 per cent (declined 585,000) to 41.14 lakh from 47 lakh and declined 2.9 per cent (declined 121,000) QoQ from 42.36 lakh.

    Triple play customers have been increasing, the increase becoming more rapid since Q3-2014, indicating to an extent that double play customers were adding one more play, rather than the company losing double play customers, besides adding more new customers for residential triple play. Triple play customers in Q3-2015 increased 25 per cent (increased 1,022,000) to 51.05 lakh from 40.83 lakh in the corresponding year ago quarter and increased 4.5 per cent (increased 218,000) from 48.87 lakh in Q2-2015.

    Business Services

    While TWC’s Business services segment had only 4.7 per cent of TWC’s overall customer relationships, it contributed 14.1 per cent to TWC’s consolidated revenue. As a matter of fact, its contribution to TWC’s revenue has been increasing much faster than the increase in its customer relationship share in the overall pie. BS revenue in the current quarter increased 15.5 per cent (increased by $112 million) in Q3-2015 to $836 million (14.1 per cent of consolidated revenue from 4.7 per cent of overall customer relationships) from $724 million (12.7 per cent of consolidated revenue from 4.5 per cent of overall customer relationships) in the corresponding year ago quarter and increased 4.1 per cent (increased by $33 million) from $803 million (13.6 per cent of consolidated revenue from 4.6 per cent of overall customer relationships) in the immediate trailing quarter. Please refer to Fig E below.

    Revenue from Business Services High Speed data was more than 4 times the revenue from Business services video sub-segment or product in Q3-2015.