Comcast has its content and broadcasts it, too. On the content
side, the company owns NBCUniversal, including the NBC TV network
and movie studios Universal Pictures and DreamWorks Animation.
Cable channels CNBC, MSNBC, and the USA Network are also under the
Comcast tent. As for distribution, the company is one of the
biggest pay-TV providers in the US with more than 28 million
subscribers to one or more of its cable services. Its broadband
internet service has nearly 25 million subscribers and its voice
service has more than 11.5 million customers. Other Comcast
properties include the Universal Studios theme parks and Telemundo,
a leading Spanish-language TV network in the US.
Operations
Comcast generates revenue in five business segments, led by the
cable communications service that accounts for about 60% of
revenue. Then come the cable networks, about 15% of revenue,
broadcast TV, more than 10% of revenue, and filmed entertainment
and theme parks, a bit more than 5% each.
Comcast hasn't forgotten its hometown roots in Philadelphia.
Through its majority-owned subsidiary Comcast Spectacor, the
company owns Philadelphia's NHL franchise, the Flyers, as well as
the team's arena, the Wells Fargo Center. The subsidiary also
manages other venues used for sporting events and music concerts in
Philadelphia, as well as related service businesses including
Ovations Food Services and facilities management provider Global
Spectrum.
Geographic Reach
Comcast has operations of one kind or another in all 50 states.
Its cable communications operations are along the East Coast, in
the South, the Midwest, the West Coast, and Pacific Northwest. The
company owns and operates NBC-affiliate TV stations in the seven
top markets in the country as well as three others in the Top 30.
Sales and Marketing
Comcast offers its services directly to residential and business
customers through call centers, door-to-door selling, direct mail
advertising, television advertising, internet advertising, local
media advertising, telemarketing, and retail outlets. The company
spends about $6 billion a year on advertising, marketing, and
promotion.
Financial Performance
Comcast posted higher top and bottom lines in 2016, continuing a
decade-long rise in revenue and a six-year increase in net
income.
Revenue increased 9% to almost about $80 billion in 2016 from
2015. Cable communications revenue rose about 8% from more
subscribers overall and more signing up for additional services.
The average revenue per cable customer relationship increased to
more than $148 a month in 2016 from about $143 a month in 2015.
Revenue jumped about 20% at NBC and about 10% at the cable
channels, boosted by the 2016 Rio Olympics. Revenue from the
company's movie unit fell in 2016 due to a smaller, less lucrative
slate of releases. High performers for the year were The Secret
Lives of Pets and Sing. Theme park revenue rose with
help from the acquisition of 51% of Universal Studios Japan in late
2015.
Comcast reported that net income rose about 7% to some $8.7
billion in 2016 from 2015 as revenue kept pace with costs.
Cash flow from operations in 2016 rose to about $19.25 billion
from about to $18.8 billion in 2015 due to higher net income and a
change in working capital.
Strategy
To stanch the flow of video cable customers from its services,
Comcast has bundled multiple services and offered slimmed-down
cable deals (fewer, more selective channels) to attract and retain
customers. The company also has improved its customer service,
reducing wait times, increased on-time arrivals, and added
representatives to its customer call centers. The changes might be
paying off: Comcast added more than 160,000 cable subscribers in
2016 after losing some 230,000 cable customers in 2014 and 2015.
The company and other cable providers have lost customers -- called
cord cutters -- who prefer to get their entertainment from
streaming services such as Netflix, YouTube, Hulu, and other
over-the-top services.
Another factor has been Comcast's X1 platform, a cloud-based
set-top box that offers live video, on-demand video, and digital
video recording. It stores customers' recordings in the cloud,
which add to the amount they can record. The service is available
to Comcast customers across the country. Besides added revenue from
the X1 services, Comcast looks for additional advertising revenue
by using data gained from viewer habits to customize ad
targeting.
Adding to its array of services, Comcast in 2017 rolled out
wireless phone service to its internet customers. Called Xfinity
Mobile, the service offers several calling plans. Comcast rents
space on Verizon's network, but the service is available over
Comcast Wi-Fi.
Mergers and Acquisitions
In 2016 NBCUniversal acquired DreamWorks Animation SKG Inc., a
maker of animated movies and TV shows, for about $3.8 billion. This
acquisition of the maker of films such as Shrek and
Kung Fu Panda series was made to bolster Comcast's
offerings for children's pictures for theatrical release.
Comcast acquired 51% of Universal Studios Japan for $1.5 billion
in 2015. The deal gives Comcast control of the Universal theme park
in Osaka, Japan.