NBCU toppers outline plan
Comcast will spend $200 million more per year to boost primetime programming at the NBC broadcast net and $100 million more on its cable network shows, NBCUniversal topper Steve Burke said Wednesday.
However, Burke said the turnaround in ratings at NBC will not be based on the amount of dollars budgeted for shows.
“It’s about making better shows,” he said, pointing out that NBC is making the same number of pilots — 21 — as it did last year before Comcast owned a majority stake in NBCU. Burke said he would be traveling soon to Los Angeles to see the first pilots offered up under NBC’s new boss, Bob Greenblatt.
In discussing first-quarter earnings on Wednesday, execs said it was important to be patient with NBC’s turnaround. “It’s going to take time,” said Comcast topper Brian Roberts. Burke said it would be a “multi-year” project, but added that broadcast has big upside for Comcast, both at the network and at the local TV stations.
In the first financial report since becoming majority owner of NBCUniversal, Comcast said revenues for its new joint venture in the period ended March 31 decreased 11.5% on a pro forma basis to $4.3 billion, while operating cash flow rose 5% to $496 million. Excluding last year’s Vancouver Winter Olympics, pro forma revenues at NBCU grew 6%.
When asked about whether given recent losses from the Olympics NBCU would still be a bidder for the Games and other big-ticket sports rights, Burke said, “We are in business to make money. We will be disciplined.” He said he thought the Olympics and the NFL are “two fantastic properties, but we like to make money.” He added there are ways to turn a profit on sports.
Overall, the nation’s No. 1 cable operator said its revenues rose 32% to $12.1 billion, including two months of NBCU results. Execs said the core cable operations and NBCU’s 16 national cable nets and 12 regional sports nets drove the results.
After a year-long regulatory review, Comcast closed the deal on its joint venture with GE at the end of January. Net profits were up 9% to $943 million. Comcast’s costs related to the joint venture in the quarter were $107 million.
“We are off to a terrific start in 2011,” Roberts said in a statement. “Cable had an outstanding quarter, with continuing momentum in both our residential and business services operations. We had particularly strong growth in high-speed Internet, consistent growth in voice services and improving video customer results. In addition, our customer retention and service metrics have never been better, and we are leading the industry in delivering new products and innovations to our customers.”
Comcast lost another 39,000 TV subscribers in the quarter. That follows declines of 135,000 subs in the fourth quarter, bringing the total for 2010 to 757,000. However, Comcast gained 418,000 broadband subscribers in the first quarter and 260,000 phone customers.
At NBCU, the cable networks continued to be the stars, with revenues up 13% to $2 billion, while the division housing broadcasters NBC and Telemundo showed declines of 35% to $1.3 billion. The Vancouver Games resulted in losses of $223 million. Universal studio also posted revenues declines, of 8% to $975 million, on lower theater and home entertainment dollars. Universal theme parks were up 16% to $95 million.
Execs said they were pleased with synergy efforts so far between NBCU and Comcast, including cross-promotional efforts for the NBC vocal competition show “The Voice” and Universal Studios’ Easter Bunny animation movie “Hop.” Burke said a hit show like “The Voice” could be a “building block” for NBC’s primetime sked.
Execs also said they expected strong results from the upfront this year, pointing out that with NBCU, Comcast is now $10 billion-a-year advertising business.