Businessmodel of Comcast

Customer Segments

Comcast has a mass market business model, with no meaningful distinctions between different customer segments. The company caters to all individuals who desire to consume entertainment and conduct communication activities. They have broadly similar needs and problems.

Value Proposition

Comcast offers three primary value propositions: convenience, cost reduction, and brand/status.

The company creates convenience by enabling consumers to utilize a wide variety of entertainment and communication services (TV, Internet, voice, etc.) through one provider. This cuts down on the administrative headaches of managing these channels.

At the same time, Comcast allows consumers to pay for the services in packaged formats called bundles – “double product” for two services and “triple product” for three services. This allows customers to save costs that would be spent paying for each offering individually.

Lastly, Comcast has a well-established and recognized brand name. The company has been in operation since 1963 and is the largest broadcasting and cable company in the world, with over 27 million customer relationships. This makes people who are trying to decide on a media/technology provider more likely to trust what it has to offer, despite any issues regarding its reputation on performance.

Channels

Comcast operates through five main channels: television, the Internet, mobile devices, movie theaters, and theme parks. In 2015 the company’s total number of Internet subscribers surpassed that of its cable subscribers, making the former its top distribution channel.

Customer Relationships

Comcast’s customer relationship is primarily of a personal assistance nature. A service representative visits customers’ homes to install equipment and connect them to its systems. Afterwards, if there are any questions, users can contact its 24/7 call centers for assistance from a live individual and schedule another visit if necessary. That said, there is also a self-service component as basic inquiries can be answered on its website.

Key Activities

Comcast’s key activities focus on platform management. The company’s business model entails maintaining the network infrastructure through which it provides media and technology services to customers.

Key Partners

Comcast’s key partners are cable networks, local broadcast television stations, customer premise equipment manufacturers, communications vendors, and multichannel video providers. It signs contracts with each in order to provide its services to customers.

Key Resources

Comcast’s main resources are found within its Cable Communications segment; these include its cable distribution system, customer premise equipment, other equipment, and buildings. It also maintains a sizable customer service staff that operates on a 24/7 basis and installation employees.

Cost Structure

Comcast has a value-driven structure, aiming to increase customer satisfaction through significant accessibility to installation and support staff and continuous new service enhancements.  The company’s biggest cost driver is a fixed cost, programming expenses (the fees that it pays to license the programs offered to customers). Other major cost sources are technical and product support (fixed), advertising/marketing/promotion (variable), and customer service (fixed).

Revenue Streams

Comcast’s primary revenue stream is the subscription fees that it charges for access to its various Cable Communications services (video, high-speed Internet, voice). Other significant sources are fees paid for its filmed entertainment and theme parks, advertising fees, and licensing fees.

Finally, Comcast also generates revenue (to a lesser extent) through business services (cable services offered to small and medium-sized businesses) and other services (cable franchise and other regulatory fees as well as earnings from home automation and security services).