• by Wayne Friedman , May 9, 2008

Cablevision Systems continues to grow its revenues--up 10.1% to $1.72 billion in the first quarter. But the cable operator widened its losses, now $31.6 million--more red ink versus its $26.3 million in the same period a year ago. Most of the losses were based on derivative contracts.

Operating income showed better results--44% higher to $245.5 million, virtually all coming from new customers for core cable TV business, digital video, high-speed Internet and phone services.

Earlier in the week, Cablevision announced it was buying the Sundance Channel, the network founded by Robert Redford, for $496 million. The channel will be housed in Cablevision's Rainbow Media programming division, which also owns AMC, IFC and WE tv.

Cablevision--which is based in Long Island, N.Y., with about 3 million cable TV subscribers in the area--has also bid $650 million for Long Island Newsday, a daily newspaper owned by Tribune Company.

But Rupert Murdoch's News Corp., which owns the New York Post, another bidder for the paper, believes it has the inside track at purchasing Newsday and expects to sign a deal within days.

After previous periods of stagnant growth to its basic cable business, Cablevision said basic cable customers inched up 2,000 customers in the fourth quarter. Cablevision has admitted that Verizon's FiOS video service has been making major inroads into the growth of its core business. FiOS now covers 30% of Cablevision's territory.

Other parts of Cablevision's business are doing better.

Digital video subscribers rose by 41,000, or 1.6%, and up 6.3% from the last 12 months. Some 61,000 broadband customers were gained, a 2.7% increase from the fourth quarter and up nearly 11% from a year ago. Digital phone customers climbed by 93,000, a 5.8% hike over the fourth quarter and 28% for the last 12 months.