Altice USA says its subscribers and the company will look to get price "relief" when it comes to regional and national sports networks due to the absence of live sports games and events, following the suspension of virtually all sports since mid-March.
The fourth-biggest U.S. cable network says it had initial discussions with major sports networks focused not only on consumers getting relief, but on Altice getting relief in terms of the carriage fees it pays to networks.
“Well, to be clear, we owe people money, all right,” said Dexter Goei, chief executive officer of Altice USA, during the earnings call with analyst on Thursday. He added: “It’s a lot of people owing us money on this stuff.” This include all national and regional sports networks.
Goei says the New York State Attorney General has pushed for relief for consumers who are sports TV subscribers: “We are in complete agreement with New York AG.”
Concerning its first-quarter earnings results, Altice USA grew revenue 2.2% to $2.45 billion -- with revenue gains in broadband, and lower revenues in its video businesses. Altice trimmed its net losses to $1.54 million from $25.2 million in the first quarter of 2019.
Broadband grew revenue 14% to $885.5 million, with video revenue sinking 7% to $947.1 million.
Broadband grew subscribers by 50,100 to 4.24 million; with video subscribers sinking 41,700 to 3.14 million.
Altice says there has been a sharp rise in broadband usage among its subscribers -- up 24% over the same period averaging close to 400 gigabits per customer in March, coming from higher video streaming, online gaming, VPN and video-conferencing services.
Longer-term COVID-19 issues could cause disruptions in its news and advertising businesses. Altice’s News and Advertising unit had revenue growing 11.4% to $105.5 million in the first quarter from higher results at its advanced advertising division -- a4 --and its news platform, Cheddar.
Altice’s Goei said: “Many of our [small- and medium-size business] SMB customers have had to temporarily close their retail operations, which raises the possibility to increase bad debt and it’s impacting local advertising revenues.”
He added there have been “local ad cancellations in some of the most affected industries such as hospitality and auto.” Still, he does expect political advertising to contribute strongly in the second half of the year.