This was a week for numbers. It started out with continuing word that the Securities and Exchange Commission was informally asking telecommunications companies about subscriber counts – how they are done, what they mean, etc. It is ending with a truly impressive half-yearly report from the NCTA on cable’s progress. Both should be looked at carefully. First, the SEC reporting. While the trade press in particular seemed to focus on the fact that several cable companies got the informal inquiry from the SEC on subscriber counts, in fact the Commission is doing a far wider inquiry than that, and the immediate "uh-oh" reaction of some is not, I think, warranted. Counting, and, indeed, defining "subscribers" has always been a complicated business, made more so by cable’s broadband build-out, which allowed us to provide many products to the same home. Some of the issues are not new; how do you treat bulk contracts at multiple dwelling units? If someone takes two different services, or for different times, how do you count them? "Subscriber" may just be the wrong term. Indeed, at one point the requirement to report subscriber numbers to the FCC and to the Copyright Office seemed to conflict as to how to count! Much to the industry’s credit, and particularly to the leadership of Insight’s Mike Willner when he was the NCTA chairman, a uniform system for counting "revenue generating units," which is a far more accurate term than "subscriber," was hammered out, and is generally in use now. Thus, when the SEC asks the cable industry what we are counting, most will have a clear answer. That is not likely to be as true for the telephone companies, wireless companies and satellite companies, which also got the SEC letter. We saw a problem, reinforced by the Adelphia mess, and attacked it head-on. Hopefully there won’t be cable headlines like the one this week noting Verizon has acknowledged an inflated 1.5 million long-distance customer counting error. Good for us. What’s also good for us is the half-yearly report the NCTA just issued, which I strongly suggest you access (at download, and print out! Why print the whole thing out? Because it tells our story in the best way possible – with numbers, charts and graphs. It shows what we have been doing with the money that folks pay for their services. It shows, for instance, that we have increased our high-speed broadband data customer base to more than 17 million. That’s 20% of our basic cable base, and 25% of all cable households with Internet access. This is one of the most successful consumer electronic product rollouts on record. I believe the only faster one was DVD. The report also graphically shows how much the industry has spent ($85 million since 1996) to upgrade our infrastructure to be able to provide services like High Definition television, which is now available to 84 million television households passed by cable – an increase of 125% since January 2003; the number of folks now using cable telephone service is almost 3 million and likely to climb fast. The report has all the information in it, and it’s the type of thing you should share with local opinion leaders, reporters, members of Congress and anyone else who might be interested. That’s why I say you should either print it out or call the NCTA and get a copy. We have reason not only to be confident of our numbers, we should be proud of them.

The Daily


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