Dolan: Few subs cancelled service after Optimum Online rate hike
Cablevision (NYSE: CVC) received a "few thousand phone calls" from subscribers after it announced a $5 monthly subscription fee increase for its Optimum Online service in December, but fewer than 100 subscribers cancelled service as a result of the price hike, senior EVP Kristin Dolan told analysts on the company's fourth-quarter earnings call Thursday.
The MSO reported that it lost 5,000 high-speed Internet subscribers in the fourth quarter, but it blamed most of the subscriber losses on the impact of Hurricane Sandy. Dolan said that the MSO, which has spent heavily to build a Wi-Fi network in New York, New Jersey and Connecticut, told subscribers that called about the rate hike "how important Wi-Fi is for them."
Also worth noting from Cablevision's Q4 earnings call:
- CFO Greg Seibert said that Cablevision saw its programming expenses jump by about 12 percent in 2012. The company expects it will see a similar increase in programing costs this year.
- Seibert said Cablevision temporarily stopped disconnecting subscribers for non-payment in the weeks after Hurricane Sandy. The MSO resumed disconnects for non-payment in January, he added.
- CEO Jim Dolan said Sandy delayed Cablevision's work on new product initiatives. "The storm clearly set us back with our initiatives about two months," Dolan said.
- Jim Dolan said that Cablevision repaired about 450 miles of cable that was damaged by Sandy, and that 93 percent of its headend locations lost commercial power during the storm. About 60 percent of Cablevision's Optimum East subscribers had service interruptions during the storm.