IP Democracy: Comcast's Burke: No Real Telco Competition Until '07 or Beyond

Comcast Cable President Steve Burke made a number of surprisingly specific industry-wide predictions during a talk he gave today at Bank of America’s Media, Telecommunications and Entertainment Conference. The straightforward Burke addressed Wall Street’s disenchantment with the cable business, saying that investors have the misperception that cable is suddenly subject to competition for the first time, and that phone company entry into the video business is ratcheting up the competitive tension.

“You have this history in the cable business of investors assuming that cable is a monopoly and therefore a good business to invest in. The reality is that cable hasn’t been a monopoly for a long time,” Burke said, pointing to ten years of DBS rivalry and, more recently, cut-rate pricing competition for high-speed customers instigated by the telcos.

Phone company competition in the video business is, however, pretty thin, Burke maintained. “The reality on the ground is that we don’t have realistic competition from Verizon or AT&T until 07 or beyond.”

“There are a variety of structural reasons that lead me to believe we will have eight or ten million telephone customers before the Bells have one million video customers,” Burke predicted. Although Comcast is taking a slow-but-steady approach to its voice service roll-outs, the operator’s telephony momentum will gain speed. “To the degree that people are disappointed that we’re not adding 500,000 or one million units per quarter, I think our time will come.”

Another specific projection by Burke: If Cablevision’s networked DVR trial proves successful, and Burke thinks it will, the entire cable industry will adopt it. “If it all works out, I’m sure the rest of the industry will follow.”

Comcast is confident that networked DVR, as conceptualized by Cablevision, is permissable under the copyright laws. “Our lawyers have told us they think Cablevision is on fairly firm footing. They did it very carefully to replicate the experience the consumer has with the DVR,” Burke said.

Finally, Burke predicted that within six months, the VOD window will shorten to the point where films are made available on-demand on the same date they are released on DVD. “My prediction is that your’re going to start seeing some kind of day and date [release of filmed content] in the next six months.”

Posted by Cynthia Brumfield on March 30, 2006 5:19 PM to IP Democracy