Cable operators confident during financial crisis
September 22, 2008
Regardless of how bad the U.S. economy gets, average Americans will continue to subscribe to cable and satellite television as a matter of escape, executives of the major pay TV providers said last week.
“As we look around us at the economy, the subscription part of the business has done well,” Glenn Britt, chief executive of Time Warner Cable, told a financial conference sponsored by Goldman Sachs in New York City on Thursday. Others agreed. “I think people look to television as something they can depend on,” said Chase Carey, chief executive of DIRECTV.
“They cut out restaurants, they cut out theaters, but television is something they can hang on to in tough times,” Carey said in a report from Reuters.
Pay-TV stocks have been seen as recession proof or recession resistant by investors because Americans are more likely to try to save money by staying at home to watch TV rather than go out.
Michael Angelakis, chief financial officer of Comcast, the largest cable provider in the U.S., said the subscription business model helped give “real resiliency” to its business.
“What I really like about the business is we have a defensive, resilient business that can take some body blows related to the economy which we are feeling now,” said Angelakis.