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Comcast Trims Sub Losses, Reaps NBC’s Olympic Gains

Comcast kicked off the third-quarter cable earnings season last week with improved performance on the distribution front, reporting its eighth consecutive quarter of reduced video customer losses, while its NBC broadcast unit received a healthy boost from the 2012 Summer Olympic Games.

Comcast shed about 117,000 video customers in the third quarter, 29% better than the 165,000 subscribers lost in the same period last year and the eighth straight quarter of improvement. The reduced losses, coupled with a gain of 287,000 high-speed data customers (ahead of the 261,000 added last year) and 123,000 additional voice customers (slightly behind the 133,000 added in Q3 2011) helped drive revenue up 7% to nearly $10 billion and operating cash flow up 7.7% to almost $4 billion.

The NBCUniversal joint venture got a strong boost from the 2012 Summer Olympics in London. Revenue for the unit increased 31.2%, to $6.8 billion, and operating cash flow was up 19.9%, to $1.1 billion. Excluding the Summer Games, revenue would have risen 8.3% and OCF would have increased 7.3% in the period.

In a research note, Credit Suisse media analyst Stefan Anninger wrote that the cable results were “solid,” adding that the impact of the Olympics was better than anticipated.

Aside from the Olympics windfall, there is additional revenue opportunity in retransmission consent for its broadcast stations, NBCUniversal CEO Steve Burke said on a conference call with analysts.

But Burke added NBCU would have to wait until current deals expire before taking full advantage of its retrans opportunity. He noted that deals representing about 25% of its subscriber base expire at the end of 2012, and some of those deals have already been concluded in a “handshake fashion.”

According to an earlier report in Sports Business Journal, NBC has upcoming retrans negotiations with Charter Communications, the National Cable Television Co-operative and Dish Network.

NBCU also has had discussions with its affiliate stations concerning receiving a portion of their retrans haul — so-called reverse compensation — and has struck deals similar to what peers ABC, CBS and Fox have done with their stations.

“We are right on schedule, right on where we thought we would be in terms of getting those deals done,” Burke said.