In order to drive its Video on Demand (VOD) business,
) - the largest cable MSO in the U.S. - is planning to roll out a
promotional offer called Watchathon, which will offer free access
of movies and TV shows to its subscribers for a week.
Both set-top box users and TV Everywhere platform users, which
include PCs, tablets and smartphones, can easily watch their
favorite movies and TV shows on demand.
Higher demand for VOD service will help Comcast to bolster its
top-line growth. Moreover, it will also help the company to
include another revenue platform with the addition of dynamic ad
insertion technology at the time of watching TV shows.
Furthermore, the new promotional offer may lure more customers to
watch popular channels like HBO, Showtime and Starz.
Another step taken by Comcast to strengthen its VOD business
is the introduction of popular Queue platform on its set top
boxes, which was previously used through Xfinity TV apps on PCs,
tablets and smartphones. Implementation of Queue application will
make VOD service more interactive for its subscribers, hence
giving it a lead over its peers.
In a recent survey, conducted by NPD Group Inc., Comcast holds
nearly 28% of the total $1.3 billion VOD market in the U.S. in
2012. Moreover, the cable operators dominate the VOD business
with 56% market share. However, it fails to compete against
Verizon Communication Inc.
) FiOS TV and
) U-Verse TV on the basis of movie-rental revenue per subscriber.
Both generated $25.29 and $13.83 revenue per subscriber as
compared to $10.33 for Comcast in 2012.
On the other hand, satellite TV operator
DirecTV Group Inc.
) and Dish Network Corp. together account for an average of just
$10.33 with a combined market share of 27%.
So we believe that the implementation of these two strategies
will help Comcast to retain its market share but at the same time
will also help the company to realize better revenue growth from
its VOD business.
Currently, Comcast Corporation carries a Zacks Rank #2
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