February 2009

The Comcast Corporation, the nation's largest cable TV provider, said Wednesday that its fourth-quarter earnings fell 32 percent, hampered by a $600 million write-down of its investment in the Clearwire Corporation, the wireless technology provider. Excluding items like the Clearwire charge, Comcast earned 27 cents a share, up 7 cents a share from the same quarter last year. Comcast's revenue and adjusted earnings beat Wall Street estimates, however, helped by growth in Comcast's video segment. Comcast also raised its annual dividend by 2 cents a share, to 27 cents. Comcast's video revenue rose 3 percent to $4.74 billion. The company lost 233,000 basic subscribers in the quarter but gained 247,000 digital customers, who pay more for service. Its average revenue per video customer rose 9 percent, to $113.80 a month, helped by customers adding to their cable channel lineup, even in the recession. Revenue from broadband Internet services rose 9 percent, to $1.86 billion. Comcast added 184,000 Internet subscribers during the quarter, down 46 percent from the 341,000 it added in the year-ago quarter. The company ended the period with 14.9 million broadband customers. Revenue from Comcast's digital phone segment rose 45 percent, to $731 million. However, the company's addition of 344,000 digital phone customers was down 44 percent from the amount added in the fourth quarter of 2007. For the year, Comcast earned $2.55 billion.

Cable operators have told the Federal Communications Commission that its proposed new data-collection form on cable competition would be an un-necessarily burdensome route to the same destination, which is that cable has not reached the so-called 70/70 threshold that could trigger new government regulation of the industry. In a filing with the FCC Tuesday, the National Cable & Telecommunications Association said that "No survey is necessary to prove that a variety of competitors have substantially eroded and continue to erode - the share of the video distribution marketplace that traditional cable operators serve." The FCC came to that same basic conclusion in January, releasing a long-overdue report that concluded that while cable does pass more than 70% of households-a fact cable readily concedes-it had not met the second part of that test, which is that 70% of those households subscribe to cable. The figure is something below 60%, said NCTA.

Technologies known collectively as Web 2.0 have spread widely among consumers over the past five years. Social-networking Web sites, such as Facebook and MySpace, now attract more than 100 million visitors a month. As the popularity of Web 2.0 has grown, companies have noted the intense consumer engagement and creativity surrounding these technologies. Many organizations, keen to harness Web 2.0 internally, are experimenting with the tools or deploying them on a trial basis. Over the past two years, McKinsey has studied more than 50 early adopters to garner insights into successful efforts to use Web 2.0 as a way of unlocking participation.

The six critical factors that determine the outcome of efforts to implement these technologies: 1) The transformation to a bottom-up culture needs help from the top.
2) The best uses come from users—but they require help to scale.
3) What's in the workflow is what gets used.
4) Appeal to the participants' egos and needs—not just their wallets.
5) The right solution comes from the right participants.
6) Balance the top-down and self-management of risk.

[Commentary] One of Daily's favorite telecom-related events is Freedom 2 Connect. It dubs itself as "a meeting of people engaged with Internet connectivity and all that it enables" and that really only scratches the surface. While a smaller affair attendance-wise, it has an amazing concentration of big brains across a wide spectrum of expertises, from network guys, to community leaders, to public interest groups, to creative professionals, to financial types, and everything in between.