Comcast 2008 Annual Report Download - page 35

Cable capital expenditures decreased 7.5% in 2008 primarily due
to lower spending in residential cable services. Line extensions
decreased in 2008 compared to 2007 primarily due to the slow-
down in the housing market. Cable capital expenditures increased
41.2% in 2007 primarily as a result of the continued rollout of our
digital phone service and an increase in demand for advanced
set-top boxes (including DVR and HDTV) and high-speed Internet
modems. These increases were accelerated by the success of our
triple play bundle and as a result of regulatory changes in 2007.
We also incurred additional capital expenditures in our newly
acquired cable systems and continued to improve the capacity
and reliability of our network in 2007 in order to handle the addi-
tional volume and advanced services.
Capital expenditures in our Programming segment were not sig-
nificant in 2008, 2007 and 2006. In 2008 and 2007, our other
business activities included approximately $137 million and $110
million, respectively, of capital expenditures related to the con-
solidation of offices in Pennsylvania and the relocation of our
corporate headquarters. Capital expenditures for 2009 and for
subsequent years will depend on numerous factors, including
acquisitions, competition, changes in technology, regulatory
changes and the timing and rate of deployment of new services.
Our 2009 capital expenditures will include the purchase of set-top
boxes associated with our migration to all digital transmission for
certain analog channels.
Acquisitions
In 2008, acquisitions were primarily related to our acquisition of an
additional interest in Comcast SportsNet Bay Area; our acquisition
of the remaining interest in G4 that we did not already own; and
our acquisitions of Plaxo and DailyCandy. In 2007, acquisitions
were primarily related to our acquisitions of Patriot Media, Fandan-
go, Comcast SportsNet New England, and an interest in Comcast
SportsNet Bay Area. In 2006, acquisitions were primarily related to
the Adelphia and Time Warner transactions, the acquisition of the
cable systems of Susquehanna Communications and the acquis-
ition of our additional interest in E! Entertainment Television.
Proceeds from Sales of Investments
In 2008, proceeds from the sales of investments were primarily
related to the disposition of available-for-sale debt securities. In
2007 and 2006, proceeds from the sales of investments were
primarily related to the disposition of our ownership interests in
Time Warner Inc.
Purchases of Investments
In 2008, purchases of investments consisted primarily of the fund-
ing of our investment in Clearwire. In 2007, purchases of
investments consisted primarily of an additional investment in
Insight Midwest, L.P. and the purchase of available-for-sale debt
securities. In 2006, purchases of investments consisted primarily
of the purchase of our interest in SpectrumCo LLC and our addi-
tional investment in Texas and Kansas City Cable Partners.
Contractual Obligations
Our unconditional contractual obligations as of December 31, 2008, which consist primarily of our debt obligations and the associated
payments due in future periods, are presented in the table below.
Payments Due by Period
(in millions) Total Year 1
Years
2–3
Years
4–5
More
than 5
Debt obligations(a) $ 32,394 $ 2,269 $ 2,957 $ 5,613 $ 21,555
Capital lease obligations 62 9 36 8 9
Operating lease obligations 2,088 385 542 328 833
Purchase obligations(b) 16,069 3,666 3,915 2,462 6,026
Other long-term liabilities reflected on the balance sheet:
Acquisition-related obligations(c) 153 118 32 3 —
Other long-term obligations(d) 3,795 232 511 383 2,669
Total $ 54,561 $ 6,679 $ 7,993 $ 8,797 $ 31,092
Refer to Note 9 (long-term debt) and Note 15 (commitments) to our consolidated financial statements.
(a) Excludes interest payments.
(b) Purchase obligations consist of agreements to purchase goods and services that are legally binding on us and specify all significant terms, including fixed or minimum quanti-
ties to be purchased and price provisions. Our purchase obligations are primarily related to our Cable segment, including contracts with programmingnetworks,CPE
manufacturers, communication vendors, other cable operators for which we provide advertising sales representation and other contracts entered into in the normal course of
business. We also have purchase obligations through Comcast Spectacor for the players and coaches of our professional sports teams. We did not include contracts with
immaterial future commitments.
(c) Acquisition-related obligations consist primarily of costs related to exiting contractual obligations and other assumed contractual obligations of the acquired entity.
(d) Other long-term obligations consist primarily of prepaid forward sale agreement transactions of equity securities we hold; subsidiary preferred shares; effectively settled tax
positions and related interest, net of deferred tax benefit; deferred compensation obligations; pension, post-retirement and post-employment benefit obligations; and
programming rights payable under license agreements. Reserves for uncertain tax positions of approximately $1.4 billion are not included in the table above. The liability for
unrecognized tax benefits has been excluded because we cannot make a reliable estimate of the period in which the unrecognized tax benefits will be realized.
33 Comcast 2008 Annual Report on Form 10-K