Dolan's Labor Pains: Voom's Birth Brings Big Losses

Cablevision [CVC] posted greater-than-anticipated 4Q losses, stemming in large part from its significant investment in Voom. Also, Cablevision said the federal investigation into some Rainbow programming units continues; its internal accounting review should be wrapped up before the 10-K filing is due in April. Voom launched Oct 15 and had 1,627 subs as of Feb 29; none has been billed yet. For the Q, Cablevision’s satellite services division reported an operating loss of $54.9mln, compared to an operating loss of $1.8mln in the year-earlier period. The company said it was "premature" to give guidance for Voom this year and "none would be forthcoming until the company is actually spun off." The spin off of the hi-def DBS service may occur in 2Q or 3Q, following the compulsory 10-K filing. Also hurting 4Q numbers: The unexpected delay in CVC’s NYC upgrade, which was completed almost 6 months behind schedule and had the inimical effect of denying area subs any bundled offerings. Aside from these problems, Cablevision actually showed strong growth in key digital service offerings, including VoIP (+29K subs in 4Q) and HSD (+72K, for a total of 1mln subs), although basic subs declined (-11K) thanks to a strong DBS presence in CVC’s outer boroughs footprint. An interesting omission: There was no mention of the pending arbitration hearing that will decide the pay structure (and subsequent future) of YES Net.