Co-CFO cable guys' focus: dual revenue streams.

• Author: Heffes, Ellen M.
• Position: Cover Story

In the duel for dual revenue streams -- subscribers and advertisers -- Comcast Corp. is on top of its game. With its financial team led by co-CFOs John Alchin and Lawrence S. Smith, it seems to have a strong business model to reel in revenues through its three core components: cable, commerce and content. It's growing primarily by adding subscribers through acquisitions, while also investing in select strategic business areas. To its advantage, Comcast's infrastructure is organized to support its customers' growing demands for anytime/anyplace data and digital delivery.

In the last two years, 4 million subscribers were added through a series of acquisitions. If and when the hard-fought bid for AT&T Broadband is approved and completed (it is expected to close after September of this year), that will mean integrating an additional 13.5 million on top of the 8.5 million at year-end -- to a total of 22 million subscribers.

Even during the recent economic slowdown, Comcast was growing revenue. Cash flow in the cable division grew by 12 percent in 2001, and is expected to grow to an even greater degree -- between 12 to 14 percent -- this year. Last year the company generated about $10 billion of revenue, with about 50 percent of that coming from the cable division.

Founded in Pennsylvania in 1963, Comcast is the third-largest U.S. cable company; with the AT&T deal, it will jump to the number 1 spot. Closing the AT&T deal will also settle an old score for Comcast which lost out on nabbing MediaOne when AT&T came in with a higher bid. Executive Vice President Lawrence S. Smith says that over the last several years, AT&T has re-clustered its collection of by doing swaps and trades. "When all is done, Comcast will have something like 79 percent of our combined subscribers in systems with at least 250,000 subscribers, and have a significant presence in 17 of the country's top 20 DMAs (demographic metropolitan areas)," adds John Alchin, Executive Vice President and Treasurer.

In the 12 years since he's been with the company, Alchin has worked closely with Smith, to the point where he says, "We finish each other's sentences." Alchin manages the external CFO role, the capital formation and investment community activities, and also manages the treasury functions Smith, who joined the company in 1988, has responsibility for the internal CFO functions: finance operations that include tax and accounting, as well as corporate development.

Contrary to other...