Deborah D. McAdams /
01.22.2013 12:41PM
Verizon: $50 Non-Sports HDTV FiOS Package, Most New Subscribers, Record Revenues, 4Q Loss
Smartphone costs bite into margin
NEW YORK – Verizon followed up record fourth-quarter numbers with a TV strategy that works around the escalating cost of sports programming.

Verizon this week introduced a new $50 HDTV package for FiOS that includes general entertainment, news and video-on-demand—just not sports. The package comprises 145 channels, including local broadcast stations, Disney, Nick, Cartoon Network, CNN, MSNBC, The Weather Channel, The Discovery Channel, USA, TBS, AMC, FX, BET, Bravo, Food Network, HGTV, TLC and others plus 46 music channels and VOD.
 
When purchased as stand-alone subscription, FiOS TV Select HD will cost $50 per month. By comparison, the FiOS TV La Conexion package with 185 channels, including 69 Spanish-language channels, is $55;  the Prime HD package with 210 channels is $65. The 145-channel FiOS bundle, with 15/5/Mbps broadband and voice-over-IP service, goes for $80 a month “plus taxes, fees and equipment charges” with a two year contract.

FiOS, Verizon’s fiber-optic TV business added 134,000 subscribers in the fourth quarter of 2012, bringing its total video subscribership to 4.7 million. FiOS broadband added 144,000 customers, bringing that total to 5.4 million. The FiOS network passed 17.6 million premises at the end of 2012. FiOS TV had 33.3 percent penetration, up from 31.5 percent a year earlier. FiOS broadband had 37.3 percent penetration compared to 35.5 percent in 4Q11.

Verizon’s Wireless business added a record 2.1 million subscribers in 4Q for a total of 98.2 million, with 58 percent of them using smartphones. Verizon said it added eight 4G LTE smartphones in 4Q12, including the Droid Razr HD and Maxx HD by Motorola; the Windows 8X and Droid DNA by HTC; Nokia Lumia 822; Samsung’s Galaxy Note II and Stratosphere II; and the Spectrum 2 by LG. New tablets include the Samsung Galaxy Tab 2, the Apple iPad with Retina display and the iPad Mini.

Margins for the Wireless division were lower than analysts predicted, Reuters reports, in part due to higher-than-expected subsidies Verizon pays to smartphone makers to promote the devices at a discount to consumers.

The smartphone effect played into Verizon’s $1.93 billion 4Q12 loss, even though it posted record consolidated revenues of $30 billion. Expenses incurred from damages by Hurricane Sandy, as well as one-time pension charges, also contributed to the loss.

Verizon said its 4G LTE network is now available to 273 million people in 476 U.S. markets. The voice and data transmission provider said it would start offering shared data plans for businesses on Jan. 24, 2013.

 



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