Burke: NBCU ‘skeptical’ of OTT services

NBCUniversal CEO Steve Burke has expressed skepticism over the long-term impact of over-the-top channels services such as Sling TV, Hulu Live and YouTube TV.

While noting that Comcast-owned NBCU had signed “very favourable” deals with most of the US’s a la carte channels providers, he claimed these were “not all that material” to the entertainment company’s core business.

Commentators and analysts have pointed to ‘virtual multiple system operators’ (VMSOs) posing a significant threat to the traditional pay TV business.

“We’re skeptical that it’s going to be a very large business or profitable business for the people that are in it, and they’re off to a relatively slow start,” Burke (pictured) added in a call with investors.

Burke claimed there had been “no speed up or slow down in the amount of subscriber losses” at NBCU in the past few years. Comcast lost 34,000 subs during the second quarter of 2017, its financial results show.

Low cost, slimmed-down channel bouquets have sprung up in the past two years offering aimed at providing potential cord cutters with an alternative to expensive cable TV subscriptions.

Despite Burke’s doubts, US cable giant Comcast is considering whether to launch Xfinity Instant TV, which would provided streamed channels for around US$15 a month.

Beta tests are currently underway in a few US states. Comcast Cable’s CEO, David Watson, said: “We’ll launch it more broadly in the second half of the year.”

“It’s ideal for certain segments and millennials in the test markets” because it would not require a set-top box, he added.

NBCU’s second quarter financials saw it post EBITDA of US$2.07 billion on revenues of US$8.3 billion. Both metrics were up on results a year ago

The broadcasting segment, which houses US broadcaster NBC, saw EBITSA rise 5.5% to US$416 million, with cable networks up 11.7% to US$1.1 billion.