VOOM’S PRICE HIKE;
Service setup no longer free;
In an effort to curtail losses and prepare for spinoff by Cablevision, company also raises programming fees
BYLINE: BY HARRY BERKOWITZ
BODY: Voom has stopped giving it away.
The nationwide satellite TV service launched by Cablevision Systems Corp. in October has begun charging $199 for installation in an effort to cut heavy initial losses.
Previously, installation was free for customers who did not buy equipment up-front. That deal was aimed at attracting more subscribers after a slow start for the service, which stresses high-definition programming.
The new installation charge also is aimed at cutting back on customers who sign up for the service but then don't pay the required monthly fees.
Voom has raised its monthly programming fees by $10, pushing them to $49.90 per month for a basic package and $89.90 for one that includes premium channels such as HBO and Showtime. Spokeswoman Bo Park said the higher fees reflect the addition of more channels.
Voom, based in Jericho, is continuing to charge $9.50 a month for equipment if customers do not choose the option of paying $499 for equipment and installation up-front.
Cablevision, which is preparing to spin off Voom as a separate company with its own publicly traded stock, has assured investors and lenders that there will be limits on how much money the venture will spend.
"While the higher prices do not ensure Voom's success, it shows that management is no longer willing to lose as much per new subscriber," said Richard Greenfield, an analyst at the independent research firm Fulcrum Global Partners.
In recent filings, Cablevision said that beyond initial financing, the new venture, which will also own the cable channels AMC, Independent Film Channel and WE: Women's Entertainment, will not spend more than $150 million per year and $600 million altogether on Voom. For initial financing, in addition to a $950 million credit line, Cablevision is about to sell $800 million in junk bonds.
As of April 30, Voom had 8,000 activated customers plus 3,400 awaiting installation. DirecTV and Echostar Communications have at total of more than 22 million subscribers.
Service setup no longer free;
In an effort to curtail losses and prepare for spinoff by Cablevision, company also raises programming fees
BYLINE: BY HARRY BERKOWITZ
BODY: Voom has stopped giving it away.
The nationwide satellite TV service launched by Cablevision Systems Corp. in October has begun charging $199 for installation in an effort to cut heavy initial losses.
Previously, installation was free for customers who did not buy equipment up-front. That deal was aimed at attracting more subscribers after a slow start for the service, which stresses high-definition programming.
The new installation charge also is aimed at cutting back on customers who sign up for the service but then don't pay the required monthly fees.
Voom has raised its monthly programming fees by $10, pushing them to $49.90 per month for a basic package and $89.90 for one that includes premium channels such as HBO and Showtime. Spokeswoman Bo Park said the higher fees reflect the addition of more channels.
Voom, based in Jericho, is continuing to charge $9.50 a month for equipment if customers do not choose the option of paying $499 for equipment and installation up-front.
Cablevision, which is preparing to spin off Voom as a separate company with its own publicly traded stock, has assured investors and lenders that there will be limits on how much money the venture will spend.
"While the higher prices do not ensure Voom's success, it shows that management is no longer willing to lose as much per new subscriber," said Richard Greenfield, an analyst at the independent research firm Fulcrum Global Partners.
In recent filings, Cablevision said that beyond initial financing, the new venture, which will also own the cable channels AMC, Independent Film Channel and WE: Women's Entertainment, will not spend more than $150 million per year and $600 million altogether on Voom. For initial financing, in addition to a $950 million credit line, Cablevision is about to sell $800 million in junk bonds.
As of April 30, Voom had 8,000 activated customers plus 3,400 awaiting installation. DirecTV and Echostar Communications have at total of more than 22 million subscribers.
