March 16, 1999:
AT&T Sees Strong
Digital Demand
New York-AT&T Broadband & Internet Services president Leo J. Hindery Jr. touted the former Tele-Communications Inc.'s success at recruiting digital-cable customers as "the primer for the launch of other new services"- high-speed data and cable telephony.
Hindery spoke at a Merrill Lynch & Co. investment conference here Tuesday, after AT&T Broadband reported TCI's 1998 results.
TCI's year-end digital-cable-subscriber count was 939,000 in systems that AT&T Broadband will own and operate going forward. That represents digital-cable penetration of about 10 percent. The annualized penetration rate is higher, at 12 percent, as demand is rising, Hindery said.
AT&T Broadband wants to end 1999 with 1.8 million digital subscribers, rising to between 2.8 million and 3 million at the end of 2000, he said.
TCI also had 29,000 pro forma @Home Network customers at the end of the year. AT&T Broadband's goal is 150,000 to 175,000 @Home subscribers by Dec. 31.
Pro forma, adjusting for system deals, TCI's cable revenue rose 5.3 percent in 1998, to $4.8 billion from $4.6 billion in 1997. Operating cash flow rose 2.5 percent, to $2.07 billion.
Revenue growth was slowed by TCI's relatively low 3.9 percent average rate increase, and cash flow was crimped by higher "launch and development" costs, mostly for digital cable, Hindery said.
TCI's cable operations ended 1998 with 10.7 million pro forma subscribers, with internal growth of about 1.7 percent.
· 3/16/99
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