Comcast says digital switch costly

[Gregg Lengling]

By Chitra Somayaji, Bloomberg News

Comcast Corp., the world's largest cable-television operator, will need to spend as much as $2 billion to televise all the channels on its systems with a digital signal, Chief Financial Officer John Alchin said.

That investment may be spread over four years, requiring the Philadelphia-based company to spend about $500 million a year, Alchin said in an interview at the National Cable & Telecommunications Association conference in New Orleans.



Comcast won't switch over to digital signals for another two or three years, he said.

Providing the TV networks in a digital format would free up capacity on the company's cable systems, letting it offer more channels and video-on-demand and high-definition TV, Alchin said.



Comcast last year used new services including digital video recorders and faster Web-access to stem the loss of customers to satellite-TV and phone carriers.

 

"It just gives us additional channel capacity to dedicate to these new services, additional functionality in services like video on demand, and makes the whole network more robust than it is today," Alchin said.

Comcast last year spent $4.1 billion on rebuilding and upgrading its cable systems for the new services and faster Web access, and will spend about $3.5 billion in 2004.






It plans to begin offering phone service using so-called Voice over Internet Protocol technology over its cable systems later this year, Alchin said.

Federal Communications Commission Chairman Michael Powell in April said FCC staff members are proposing a January, 2009, deadline for TV broadcast networks including Viacom Inc.'s CBS to switch to the digital signals.

The government wants to allocate the freed up airwaves to wireless and cell-phone businesses and public-safety needs. The U.S. Congress has required broadcasters to convert to digital TV once 85 percent of homes can be reached by digital signals.