Ops agree on financial-reporting standards

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Aiming to clear up investor confusion and suspicion about cable's financial
reporting, the largest cable operators have agreed to standardize how they treat
certain parts of their financial reports.

The new standards, which are due to be disclosed at a meeting of
institutional investors Monday, will mean that operators will eliminate some of
the disparities in how they count subscribers and treat capital spending.

Areas like revenue recognition and depreciations that are treated by the
Financial Accounting Standards Board will not be changed. But there are a host
of cable-specific measures that the FASB doesn't address.

For example, only Charter Communications Inc. counts subscribers of its
high-speed Internet services as 'basic' customers, even if they don't take
conventional cable service. That made some investors uneasy because other
operators did not count Internet-only subscribers and investors feared that
Charter was trying to artificially inflate its subscriber counts.

Now, cable operators will start detailing not just 'basic' customers -- those
who take video services -- but 'revenue-generating units,' which will include
basic, high-speed Internet and telephone customers. A customer subscribing to
all three will be counted as three RGUs, although only as one 'basic'
customer.

Operators' financial reports are also expected to include more data than some
were previously detailing.

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