Financial Accounting Blog

Monday, February 16, 2004

The New York Times reports that Comcast is attemping a hostile takeover of the Walt Disney Company . The move would allow the nation's largest cable provider to "...control costs and ensure adequate inventory for the most mature and slowest-growing part of its cable business: video programming."One clear example of this shift and proposed merger is seen through cable giant Cox Cable:
The shift in the cable industry's revenue model is already under way, and can perhaps be seen most clearly in the financial data of Cox Communications, the nation's No. 4 cable operator. In the first quarter of 2001, video services represented more than 87 percent of the company's residential revenue of $848 million. In less than three years, in the final quarter of 2003, that figure had fallen to 70 percent, even as total quarterly residential revenue had risen to $1.32 billion. In that quarter, 18 percent of Cox's residential revenue came from its cable-modem operation, and another 10 percent came from telephone service.
Ryan Rebholz