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NEW YORK (AP) - Cable TV provider Cablevision Systems Corp. disclosed plans Thursday to offer high-speed wireless Internet service across its coverage area in the New York region.
The company also reported a wider deficit for its first quarter on losses from derivative contracts, while operating earnings jumped 44 percent on gains from premium offerings like Internet access, phone service and digital video.
Chief Operating Officer Tom Rutledge told analysts on a conference call that with just over half the homes in its coverage area now subscribing to high-speed Internet service, the company had the "critical mass" to begin offering a wireless broadband service.
Rutledge said the service would be built out over the next two years or so and offer Cablevision's existing Internet customers online access through mobile devices such as Apple Inc.'s iPhone, BlackBerry handsets or laptop computers.
The network would use Cablevision's existing infrastructure but would cost the company about $100 per customer, Rutledge said. Cablevision currently has about 3.1 million cable customers on Long Island and in other areas around New York.
Cablevision's network would use WiFi technology, the kind used by the wireless routers commonly installed in homes. Rutledge said the service would be free to existing customers and be available on a fee basis to non-subscribers, and it would eventually be capable of offering phone service.
Cablevision didn't offer details on how the network would operate, and executives declined to be interviewed for further comment.
Cable companies are looking for ways to offer wireless Internet access, mobile phone and other premium services to customers as phone companies like Verizon Communications Inc. move into their territory of video and high-speed Internet.
On Wednesday a group of companies including cable industry leader Comcast Corp., Time Warner Cable Inc., chip maker Intel Corp., Google Inc. and cell companies Clearwire and Sprint Nextel announced a separate joint venture, to be called Clearwire, that will offer wireless Internet access service.
That service will use a technology called WiMax, which is similar to WiFi but promises wider ranges of service and faster speeds than the video services currently being offered on cell phones. Most wireless access being offered today in coffee shops and other public areas is WiFi, the same kind used in homes.
The earnings report came a day after Cablevision announced a $496 million purchase of Robert Redford's Sundance Channel. The network will continue on as its own brand within Cablevision's Rainbow programming subsidiary, which also includes AMC, IFC and WE tv.
Cablevision is also bidding $650 million to acquire Newsday, a major newspaper based on Long Island, but the company faces competing bids from Rupert Murdoch's News Corp., which owns the New York Post in neighboring Manhattan, and Mort Zuckerman, owner the New York Daily News. Murdoch said Wednesday he expected to clinch a deal for Newsday within a week.
Cablevision has declined to comment on its interest in Newsday, and CEO James Dolan declined to answer questions about it on the conference call with analysts Thursday. Cablevision owns a local news cable channel but hasn't operated a newspaper before.
For the first quarter, Cablevision posted a net loss of $31.6 million, or 11 cents per share, versus a net loss of $26.3 million, or 9 cents per share, in the same period a year ago. Revenues rose to $1.72 billion from $1.56 billion.
Operating income jumped 44 percent to $245.5 million, but the bottom line was affected by $104.9 million in losses from financial derivative contracts, which compared with comparable gains in that category of $65.1 million in the year-ago period.
Cablevision shares rose 36 cents or 1.5 percent to $24.11 Thursday afternoon, remaining close to the low end of their 52-week range of $20.68 to $39.75.
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