Time Warner Cable Q2 Broadband Revenue Surges, Largely Thanks to Cable-Modem Fees

Time Warner Cable’s broadband revenue climbed 12.5% in the second quarter, to $1.42 billion — driven primarily by higher-speed tiers and recently introduced cable-modem rental fees, which the operator just hiked 50% to $5.99 per month.

Over all, TW Cable’s revenue for the period increased 2.7%, to $5.56 billion, and net income rose 6.4%; to $481 million.

Meanwhile, the No. 2 operator’s video losses accelerated: Time Warner Cable lost 191,000 net video subs — worse than analyst consensus estimates of 174,700, according to StreetAccount — to stand at 11.9 million as of June 30. Revenue from residential cable TV fell 4.4% to $2.67 billion.

SEE ALSO: Pay-TV Sector Posts Worst Q1 Subscriber Trends in Four Years

The cable company added a net of just 8,000 residential broadband subs, to 11.1 million at the end of the period. TW Cable gained 13,000 business broadband customers, for a total of 21,000 high-speed Internet net adds, which was well under analyst expectations of 55,400.

The No. 2 U.S. cable company said growth in residential high-speed data revenue was primarily due to an increase in equipment rental charges and a greater percentage of subscribers purchasing higher-priced tiers of service, with 608,000 subscribers now on tiers of 30 megabits per second or higher (double year over year).

Now the MSO wants to rake in even more coin from cable-modem fees. This week, Time Warner Cable alerted customers that the modem lease fee of $3.95 introduced last fall will increase to $5.99 per month. The fee applies to about 9 million of its 11 million residential broadband customers.

Time Warner Cable said the hike in cable-modem fees is “relative to both the price of the equipment and the service agreement to always maintain or swap out the modem as needed.” The MSO also defended the increase by pointing out that it makes ongoing infrastructure investments.

Last week Time Warner Cable announced that chairman and CEO Glenn Britt will retire at the end of 2013, with Rob Marcus, currently president and COO, stepping in to take over the top job.

More Biz

  • Eddie Vedder addresses the crowd during

    Congressman Rejects Pearl Jam’s Criticism of BOSS Ticket-Reform Act

    New Jersey Congressman Bill Pascrell, Jr., the principal sponsor of the Better Oversight of Secondary Sales and Accountability in Concert Ticketing (BOSS Act) designed to reform the live-events ticket market, today rejected Pearl Jam’s call to reject the bill. Calling the bill “flawed,” the group said in a letter yesterday that it “blocks non-transferable ticketing” [...]

  • UK Producers Roundtable co-founder Loran Dunn

    Why the U.K.'s Struggling Indie Film Business Is Only Getting Tougher

    A startling one-two punch of new statistics from the British Film Institute and industry body U.K. Producers’ Roundtable have revealed the stark challenges facing the country’s independent filmmakers.  After a BFI study published in late January revealed that spending on U.K. independent film production fell by 45% to £175 million ($228 million) in 2019, a [...]

  • TV Decline Pay TV Placeholder

    Traditional Pay-TV Operators Lost 6 Million Subscribers in 2019 as Cord-Cutting Picks Up Speed

    The U.S. satellite and cable TV business declined at an unprecedented rate last year — with traditional pay-TV providers dropping a staggering 6 million customers, a 7% year-over-year decline. In the fourth quarter of 2019 alone, traditional TV distributors lost around 1.5 million subs, dropping to about 83 million total at year-end, according to estimates [...]

  • A+E Networks Renews Focus on Lifetime

    Listen: How A+E Networks Bucked the Trend and Fell Back in Love With Lifetime Movies

    In an era of overflowing choice, focus is more important than ever for traditional television executives. On the latest episode of Variety podcast Strictly Business, A+E Networks’ president of programming Rob Sharenow discusses how the cable giant pulled its flagship brands out of the ratings trenches over the past two years, thanks in large part [...]

  • Former Hollywood producer Harvey Weinstein arrives

    Harvey Weinstein Jury Wants to Hear Rosie Perez's Testimony Again

    The jury in Harvey Weinstein’s rape trial asked on Wednesday afternoon to re-hear the testimony of Rosie Perez, and asked to see several exhibits, including emails involving Annabella Sciorra. Perez testified on Jan. 24 that Sciorra confided in her in the early 1990s that Weinstein had raped her. Perez said she advised her friend to [...]

More From Our Brands

Access exclusive content