Sub Damage Likely Minimal in Cablevision, Fox Retrans Fight

Analyst estimates MSO lost about 8,000 customers in dispute

Sanford Bernstein cable and satellite analyst Craig Moffett estimated that Cablevision Systems probably lost less than 10,000 customers in its two-week dispute with Fox Networks.

In a research note Monday, Moffett wrote that Verizon averages about 1,000 FiOS TV installs a day in Cablevision territory (25% of the roughly 4,000 installs the company average nationwide) and that constraints on the number of trained installers probably limits the company from going above 150% beyond that capacity. Add to that the customers that likely waited longer into the dispute to switch and the analyst estimated that the incremental loss to Cablevision was not likely more than 500 subscribers per day. Over 16 days - Fox went dark on Cablevision systems on Oct. 16 - and the total damage is about 8,000 lost subscribers.

"In other words," Moffett wrote, "barely big enough to notice."

Also easing the impact is that most of Cablevision's customers are in apartments, which make it difficult for a satellite company like DirecTV to take away customers. The No. 2 satellite TV provider, Dish Network, was locked in its own cable carriage dispute with Fox, which also lessened the blow. (Three Fox cable channels were off Dish beginning on Oct. 1 and returned on Oct. 29). 

While Dish wasn't a factor in lost cable subscribers, it probably was the catalyst for Cablevision and Fox to go back to the negotiating table.

In his research note, Moffett wrote that Cablevision's main motivation in the retrans battle was probably regulatory intervention - Cablevision had asked the Federal Communications Commission to step in during the dispute and help reach a settlement. With Dish settling before its retrans agreement expired on Nov. 1, that may have forced Cablevision's hand.

"But once Dish had settled with Fox on Friday night, the probability of regulatory intervention dropped dramatically, and Cablevision was out of options," Moffett wrote. "They made that clear in their terse statement Friday night, which all but acknowledged that they had caved in to Fox's demands."

Cablevision has about 3.1 million video customers in the New York metropolitan area,