Comcast, thanks to some stiff competition from lower-priced DSL offerings and Verizon FiOS combined with economic woes and fears of a recession, is beginning to see some slowdown in its broadband growth. Broadband has traditionally been a growth engine — and a big moneymaker — for Comcast, so this is a disturbing sign. Of course, the stock market is pretty pleased with Comcast today — dividends, stock buybacks and the perceived pragmatism of management (exemplified, in Comcast’s case, by not buying Sprint or Yahoo, as if they really can) usually provide a short-term boost to shares before reality kicks in.
The company reported its fourth-quarter 2007 results today, saying it added about 331,000 broadband subscribers in the three months ending Dec. 31, 2007. That’s down sharply — 26 percent — from the 450,000 subscribers it added in the third quarter. Comcast had 13.22 million broadband subscribers at the end of 2007.
It seems Comcast’s Digital Voice business is also running out of breath. After adding 662,000 new subscribers in the third quarter, Comcast’s total CDV net new additions dropped to 604,000 in the fourth quarter.
Numbers like this means Comcast, like other cable operators, will have to work harder and offer better-priced plans in order to keep making gains against the phone companies. At this point it’s safe to say that 2008 is going to be a tough year for the largest cable company in the U.S.