Bloomberg News

Comcast to Let Customers Make Skype Video Calls Using TV

May 16, 2012

Skype Technologies SA video phone in Las Vegas. Photographer: Daniel Acker/Bloomberg

Skype Technologies SA video phone in Las Vegas. Photographer: Daniel Acker/Bloomberg

Comcast Corp. (CMCSA:US), the largest U.S. cable company, is introducing a service that lets customers make Skype video calls over their televisions, part of a push to add revenue and stem subscriber defections.

The Skype on Xfinity service, which lets users make high- definition video calls, will start today in Boston and Seattle and be available in cities including Atlanta, Chicago and Miami by the end of the week, Comcast said today. The feature will cost $9.95 a month for Triple Play users, which get Comcast’s Internet, TV and voice services.

Comcast, based in Philadelphia, is seeking ways to keep its cable customers loyal while adding features that can bring in additional revenue (CMCSA:US). Skype on Xfinity, which includes a video camera and a special remote control, lets users make video calls and send instant messages while watching TV. The service may be attractive to those for whom using Skype on a personal computer is unfamiliar or unappealing.

“It’s really going for a PC-agnostic user: seniors, large families who don’t want to crowd around the PC,” said Richard Doherty, an analyst at consulting firm Envisioneering Group in Seaford, New York.

Microsoft (MSFT:US) Corp., which owns Skype, probably wanted to announce the deal today to see if it can trigger more such agreements at the National Cable & Telecommunications Association’s annual show that begins next week in Boston, Doherty said. Representatives for Microsoft’s Skype service didn’t immediately respond to an e-mail seeking comment.

Cable Decline

Comcast was unchanged at $28.85 at the close in New York, and Microsoft fell (MSFT:US) 1 percent to $29.90.

Comcast reported its 20th consecutive quarterly decline in video subscribers this month, following price increases. Comcast lost 37,000 video customers last quarter. That disappointed some analysts, who had anticipated the first increase in subscribers since 2007.

Still, Comcast gained 439,000 high-speed Internet users in the quarter, topping the 382,000 projected by analysts. Average revenue per user rose 7.8 percent to $143.40. Comcast also added a net of 164,000 phone customers, less than the 187,000 average analyst estimate.

Skype became part of Redmond, Washington-based Microsoft last year after an $8.5 billion acquisition.

To contact the reporters on this story: Alex Sherman in New York at asherman6@bloomberg.net; Dina Bass in Seattle at dbass2@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net


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Companies Mentioned

  • CMCSA
    (Comcast Corp)
    • $54.73 USD
    • 1.42
    • 2.59%
  • MSFT
    (Microsoft Corp)
    • $41.67 USD
    • -0.11
    • -0.26%
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