Insight to Fight Sub Loss with Triple Play2/24/2005 5:05 AM Eastern
Three local-into-local launches by direct-broadcast satellite service providers drove basic-subscriber losses in the fourth quarter at Insight Communications Co. Inc., but the small-market MSO said it plans to reverse that trend through innovative packaging, including a triple-play offering modeled after Cablevision Systems Corp.’s $90 three-product package.
Insight lost about 11,000 basic customers during the fourth quarter, mainly due to aggressive promotion by DBS competitors in three markets. However, the MSO said it believes those were the last of the major DBS local-into-local launches in its markets (95% of Insight territories have local-into-local service from at least one DBS provider and 90% have service from both DBS companies).
Insight said it is combating subscriber erosion by refining and repackaging some of its services, the most ambitious a triple-play video, Internet-protocol telephone and data package priced at $90 per month.
Chief operating officer Dinni Jain said the triple-play offering will be slightly different from Cablevision’s offering. Instead of having each of the three products priced at $29.95 per month, Insight will package them at $40, $30 and $20 per month. Also, unlike Cablevision’s package, the video component in Insight’s promotion will be enhanced basic, not digital. Customers who want digital video will have to pay an additional $5 per month for the service.
The pricing is a one-year promotion available only to new customers, Jain added. Insight will also offer a two-product bundle to new subscribers for $60 per month ($30 for each product).
While basic-subscriber growth was down in the fourth quarter, Insight did show gains in new-product customers, adding 12,000 digital subscribers, 19,000 high-speed-data customers and 1,500 circuit-switched-telephone subscribers during the period.
Revenue for the quarter was up 11% to $262.5 million and cash flow was relatively flat at $105 million.