Sure it was obvious, but I applaud the decision by whoever organized the IMG Intercollegiate Athletics Forum to pipe The Cars “Shake It Up” through the loudspeakers of a bland room in New York’s Marriott Marquis as the conference wrapped up.
Bear with us a minute while we toot our horn (again) and point to our story on Verizon’s plans to launch an online Netflix competitor next year. Needless to say, we were pleased to get it out there first, but it’s probably unsurprising that Verizon was not ready with a press release as it hammer out deals with programmers.
Verizon Wireless plans to pay $3.6 billion for wireless airwaves from a venture of cable companies Comcast, Time Warner Cable and Bright House Networks. Comcast said that the deal represented a 64 percent premium over the $2.2 billion price the cable consortium paid in 2006 for the wireless spectrum being sold to Verizon Wireless.
Customers tired of abuse from cable companies found a refuge in Netflix, the video rental service that won over Wall Street with a fast-growing and fiercely loyal stable of subscribers wowed by great customer service.
The old cable narrative has always been about cable cowboys acting like typical old world monopolies: providing poor customer service (here’s a video of a Comcast technician having a nap on the job), terrible user experience and still having the nerve to raise prices every year. Cable companies have changed and evolved in the last decade but not enough for many customers.
Netflix was supposed to be different — very different.
It had a responsive customer service, a pleasant user experience and also fairly simple pricing. It was the opposite of cable. In no time at all users were telling their friends about Netflix.
That might have all changed.
Netflix has angered so many customers it was forced to lower its fourth-quarter subscriber projections, and CEO Reed Hastings offered an apology for the company’s handling of a recent price increase.
Hastings acknowledged many subscribers “felt we lacked respect and humility” when the company announced in July it was raising the cost for DVD subscribers by as much as $6 a month, or 60 percent. He said he “messed up” and “slid into arrogance based upon past success.”
Hastings did not, however, roll back the price increase.
Many customers weren’t buying the apology, with negative reactions piling up on the Netflix blog. Plus, Hastings provoked more anger by moving the DVD business to a separate website from the streaming service. That will force customers of both services to visit two different sites.
It’s no secret that sports has been the brightest star of broadcast television lately. It pulls big audiences, and those viewers watch live — a combination that advertisers drool over. So NBC Universal figured it was high time to make the most of its sports assets — soon to be coupled with those of Comcast — and today announced the creation of “NBC Sports Agency.”
It’s been a heady few months for Netflix, the DVD by-mail company fast becoming a online video streaming service. Yesterday, its third quarter numbers again beat Wall Street expectations as it revealed it is now the third largest video subscription service behind Comcast and DirecTV with nearly 17 million subscribers. Wall Street analysts at UBS and Oppenheimer, already in love with the company, upgraded it on Thursday morning helping to push shares to a new record high of $174.40 before closing at $172.69. To think you could have bought the stock for $47.56 exactly one year ago.
Charlie Ergen is best known in media business circles as the straight talking homely founder of satellite TV provider Dish Network Corp. He’s often been disarmingly honest on quarterly conference calls with Wall Street analysts by admitting that he had personally taken his eye off the ball when the company was losing customers a few years ago or putting his annual family vacation ahead of being present on the quarterly call.
The latest quarterly numbers from AT&T and Verizon Communications points to steady addition of TV customers which they are very likely winning from the cable companies as well as satellite players. AT&T said it posted its first ever billion-dollar revenue quarter for its U-Verse services (which includes Internet). It added 209,000 U-Verse TV subscribers and now has 2.5 million in total. Meanwhile Verizon said it added 174,000 FiOS TV subscribers and now has 3.2 million in total.
NBC Universal’s quarterly results — still wrapped into the General Electric numbers — should have some of the folks down in Philadelphia smiling this weekend. The numbers didn’t set the world on fire, but both profit and revenue showed improvement thanks to (what else) the cable division.