Voom only has 1,627 subscribers and has lost $197 Million

[Chris Blount]

Slow demand for cable company's new satellite TV service, MSG woes add up to net loss of $197M

BY HARRY BERKOWITZ
STAFF WRITER

March 3, 2004

Hampered by technical problems and programming gaps, the Voom satellite-television service that Cablevision Systems Corp. launched nationally in October has signed up only 1,627 customers and contributed to a $197 million net loss for the fourth quarter, the company said yesterday.

As part of an accounting probe, Cablevision also announced a new round of financial restatements because of mistakes dating back to 1999.

The 2003 quarterly loss, which also reflected the granting of $33 million in long-suspended management bonuses at Cablevision and continuing financial woes at the Madison Square Garden division, was in contrast to a profit of $530 million in the period a year earlier, when the company sold the Bravo cable channel to NBC.

And the slow start for the satellite service was in contrast to a fast kickoff for the $39.95-per-month residential telephone service Cablevision launched in September using the Internet. Optimum Voice signed up nearly 29,000 customers by the end of the year and was adding 2,500 customers per week.

Full Story From Newsday (http://www.newsday.com/business/ny-bzcab033693522mar03,0,7997479.story?coll=ny-business-headlines)

[ddobson]

Slow demand for cable company's new satellite TV service, MSG woes add up to net loss of $197M

BY HARRY BERKOWITZ
STAFF WRITER

March 3, 2004

Hampered by technical problems and programming gaps, the Voom satellite-television service that Cablevision Systems Corp. launched nationally in October has signed up only 1,627 customers and contributed to a $197 million net loss for the fourth quarter, the company said yesterday.

As part of an accounting probe, Cablevision also announced a new round of financial restatements because of mistakes dating back to 1999.

The 2003 quarterly loss, which also reflected the granting of $33 million in long-suspended management bonuses at Cablevision and continuing financial woes at the Madison Square Garden division, was in contrast to a profit of $530 million in the period a year earlier, when the company sold the Bravo cable channel to NBC.

And the slow start for the satellite service was in contrast to a fast kickoff for the $39.95-per-month residential telephone service Cablevision launched in September using the Internet. Optimum Voice signed up nearly 29,000 customers by the end of the year and was adding 2,500 customers per week.

Full Story From Newsday (http://www.newsday.com/business/ny-bzcab033693522mar03,0,7997479.story?coll=ny-business-headlines)

I don't think that's bad considering the fact they have a lot of expense to get going with satellites etc., then they haven't done heavy marketing because they knew they were weak in SD channels. Now they'll start rolling plus HD is picking up.

I think it took DirecTV a year to get a million customers (correct if my memory is wrong) and they had no competition. Very weak cable systems were their only challenge and they still took a long time to get customers.

I would say we need to see where Voom is in 2 years to determine whether they will fail or succeed. If they can't make it the 2 years then it was a bad business decision to start anyway.

I think if they're committed they will do well. It's in their hands. I'm convinced that if they don't blow it themselves they have a good opportunity.

[Jacob S]

Do you really think Voom could get a million subscribers in a year's time? I seriously doubt it. Perhaps 50k-100k in the first year if they start aggresively marketing, and perhaps start adding more subscriberse per quarter from there, working their way up. This also gives DirecTv and Dish Network customers another althernative satellite source for tv.

[Steve Mehs]

A guy at my school bought an HDTV a few years ago but never had any HD service. He thought the upfront cost of Dish and DirecTV, compared to the number of channels was too much. He looked at Voom but called most of their original channels 'oddballs' and said the cost was way too much. He ended up getting HD from Adelphia at no cost other then the $7 monthly rental fee for the HD box. Until HD is the standard, I think Voom will be more of a compliment to E* and D*, rather then a replacement.