CenturyLink's (NYSE: CTL) Prism TV IPTV service provided a much-needed revenue and subscriber boost to the carrier's first quarter earnings and continued to play an integral role in the telco's overall "broadband initiative," company executives said during comments on those Q1 results.
The carrier added 13,400 Prism TV subscribers during the first quarter and now has about 120,000 total subscribers for the TV service, penetrating nearly 10 percent across markets where it's available. The service launched in Phoenix, the first legacy Qwest market, during the quarter and garnered "positive sales," CenturyLink President and CEO Glen Post said during the earnings conference call.
"In the first quarter we also soft launched the service in Colorado Springs … and now also expect to soft launch Prism TV service in Omaha during the second quarter with our fiber-to-the-premises offering there," Post said.
Omaha has been gathering more attention as the locale where CenturyLink is launching 1 Gbps symmetrical broadband service--matching Google Fiber's (Nasdaq: GOOG) offer across several markets. That launch has begun and the carrier expects to reach 48,000 homes by the fourth quarter of this year, Post said.
FTTH and 1 Gbps, though, are probably secondary to the overall Prism TV strategy, Post said, because from a value standpoint Prism TV customers are more than just TV viewers.
"Over 50 percent of the (Prism TV) customers added were new customers to CenturyLink" who "have a high rate of broadband attachment--I believe about 94 percent attachment rate in the first quarter of the year," Post said.
To remain attractive, he said, the service must remain competitive with cable offerings so "we continue to enhance our IPTV features by introducing new functionality and applications, including expansion of our TV Everywhere capabilities, our video-on-demand library and our recent successful trial of wireless set-top boxes," he said.
From a consumer business segment Prism TV and broadband--which gained 67,700 new customers in the quarter and now stands at 5.9 million total broadband subs--are key to offsetting continued losses in the access line business.
Those access line losses from legacy businesses caused a 3.4 percent decline in total consumer segment revenues ($1.51 billion from $1.61 billion in 2012), even though strategic revenues were up 5.4 percent to $620 million in the quarter, the company said. The carrier lost 821,000 legacy access lines year-over-year.
- see the earnings release
- and this earnings call transcript
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