Comcast chairman and CEO Brian Roberts on Tuesday at an investor conference lauded NBCUniversal for exceeding all his performance expectations and touted the cable giant's integration of Netflix via an app on its set-top boxes.
Appearing at the Goldman Sachs Communacopia Conference in New York in a session that was webcast, he demoed the Netflix service on a Comcast TV screen to show how the integration, which Comcast is rolling out in a beta testing phase to users of its X1 interactive TV platform this week, works. He highlighted easy searching of content options available on Comcast and Netflix, quick logins for Netflix subscribers and the ability to sign up for the streaming service for people who aren't subscribers yet.
"Netflix, as we know, is wildly successful, and it has pretty much got content that you don't get with your [Comcast] X1 existing subscription," he said.
Asked how the integration deal, announced this summer, had come together, Roberts said: "[Netflix CEO] Reed Hastings and myself spent some time together," which allowed them to put together a service that would serve consumers. "I give him a lot of credit for helping make it happen." Acknowledged the Comcast boss: "We always had tremendous respect, I think, for both organizations. We occasionally didn't see eye-to-eye on everything." But he said the companies have gotten "a lot closer," adding, "I'm really pleased with the relationship." Roberts also said he didn't realize how much kids content Netflix offered until Comcast acquired Dreamworks Animation.
Roberts also signaled that Netflix could just be the first streaming video service to be offered via Comcast's platform. "Our organization has made a conscious decision that we are going to aggregate other people's content, some of which we sell directly, some of which we don't," he said, adding that the cable giant was talking with other streaming providers about offering them as well now that it has developed a "template" for such integrations.
Roberts said the Netflix service should roll out by Thanksgiving across the Comcast footprint, but didn't discuss financial or other details.
How does he feel about "skinny" pay TV bundles? "I don't know that that's really what people want," Roberts said, echoing similar comments from NBCUniversal CEO Steve Burke last week. Some consumers want to pay less, but "I don't know too many programmers who want to go a la carte" and feel that works for their business, Roberts added.
Burke had also discussed his take on OTT services and NBCUniversal's interest in having its channels on them. "OTT sounds like a better business than in reality it is," he said. He added that the company wants to make at least the same amount in OTT deals as in traditional pay TV deals. "I think OTT is happening. ... But I think it's a pretty challenged business model, and I'd be surprised if it flies out of the gate with a big number," he asserted. He argued that only few people who have a pay TV package with 200 channels would want to pay about $45 or more for just 25 channels.
Comcast and some other big cable operators have had strong pay TV subscriber trends. Comcast recently reported the loss of 4,000 video subscribers in the quarter ended in June, marking its best second-quarter result in more than 10 years. It had added 53,000 pay TV subscribers in the first quarter, marking the first time in two years that the cable giant had grown its video customers for two quarters in a row.
Asked about the reason for Comcast's strength, Roberts said Thursday: "We are very pleased to tell you our momentum is continuing" in video and beyond, because of service, value offered to consumers and other reasons. "The team is doing a great job making our product better."
While he said he couldn't comment on competitors, he added: "I don't think anyone has the scale or the focus." He said the company now has about 10 million voice remotes in Comcast homes and will by year's end have its X1 interactive TV platform in 50 percent of households.
Roberts also said his team was "thrilled" to say it has more than doubled the cash flow at NBCUniversal since buying it a few years ago. He said NBCUniversal's performance across businesses has been "beyond even my own highest expectations."
NBC just won the third season in a row in the 18-49 demographic, Roberts pointed out, and Telemundo has boosted its ratings and has beaten Univision in the young demo for several weeks in a row.
Read more: Comcast Strikes Deal With Netflix
Meanwhile, the film business will have the three most profitable years in its history, with "sustainable" franchises boosting its performance, the latest being The Secret Life of Pets. The CEO also lauded Sing, which just screened at the Toronto International Film Festival, as possibly the best movie Illumination Entertainment CEO Chris Meledandri has ever made. "Film is in great shape. Jeff Shell is doing a super job," Roberts concluded.
The Comcast boss reiterated that the cable networks business has become more challenged but lauded a low teen percentage increase in advertising rates in this year's upfront for NBCU's cable channels. Scale matters in the business, he added.
Roberts also again lauded the Summer Olympics in Rio as the most profitable for the company ever by a wide margin despite lower ratings.
The exec acknowledged that he has been in a senior position at Comcast since the conference started 25 years ago, when he was president. Investing for the long term has been a continued focus for the firm, he said. Roberts also lauded the acquisitions of AT&T Broadband and NBCUniversal, saying that they "gave us scale" and "allowed us to pivot to a different kind of trajectory."
And he said the company increasingly sees itself as an innovation company at the intersection of technology and media that "brings you to the moments in life that matter the most," from the Olympics to attending theme parks, seeing movies or other things.
Roberts also provided an update on Comcast's wireless strategy, mentioning plans to launch a Wi-Fi and mobile virtual network operator service in 2017, likely mid-year. The goal is to offer existing subscribers more services to possibly reduce user churn.