Cablevision’s VOOM Garners 8K Subs

[Gregg Lengling]

By Jeff Malester -- TWICE, 5/10/2004 10:37:00 AM

Bethpage, N.Y. — After six months of operation, the VOOM satellite service from Cablevision Systems reported about 8,000 activated customers as of the end of April.

Cablevision's Rainbow DBS segment, of which VOOM is the primary business, recorded net revenue of $1 million in the first three months, ended March 31. This income consisted primarily of sales of satellite receivers and related equipment.

VOOM, promoted as the first service to offer a comprehensive array of high-definition TV programming, recorded no revenue in the first quarter of 2003, since service was not launched until Oct. 15 of last year.

Cablevision reported an operating loss of $54.8 million for its Rainbow DBS segment in the first three months, compared with an operating loss of $1.7 million in the year-ago period. The adjusted operating cash flow deficit in the first quarter hit $45 million, compared with a deficit of $1.7 million in the same three months last year.

Both the Rainbow DBS operating loss and adjusted operating cash flow deficit were attributable to the costs of developing content for VOOM HD channels, marketing and subscriber acquisition costs, as well as general and administrative expenses, said Cablevision.

Capital expenditures for Rainbow DBS increased to $7.2 million in the first quarter, compared with $4.8 million year-on-year.

Costs associated with the launch of VOOM kicked over to consolidated Cablevision numbers for the first quarter, where the cable company reported an operating loss of $9.6 million, compared with a year-earlier $31.6 million in income.

Consolidated adjusted operating cash flow declined 8 percent in the first quarter to $267.7 million, compared with a year-ago $290.8 million.

Cablevision's consolidated net loss decreased to $120 million in the first quarter, down from a net loss of $151.3 million in the same three months in 2003.