Comcast 2011 Annual Report Download - page 7

Sources of Supply
To offer our video services, we license a substantial portion of our programming from cable and broadcast
networks. We attempt to secure long-term programming licenses with volume discounts or marketing sup-
port and incentives from cable networks. We also license individual programs or packages of programs from
programming suppliers for our On Demand service. We seek to include in our licensing arrangements the
rights to offer such programming to our subscribers on multiple delivery platforms that may be viewed in
multiple locations, such as online and through our mobile applications using smartphones and tablets.
Our video programming expenses generally depend on the number of our video customers, the number of
channels and amount of On Demand programs we provide and the number of delivery platforms on which
they are distributed, and the programming license fees we are charged. We expect our video programming
expenses to continue to be our largest single expense item and to continue to increase in the future.
We purchase from a limited number of suppliers a significant number of set-top boxes, network equipment
and services that we use in providing our cable services.
For our high-speed Internet service, we license software products (such as email and security software) and
content (such as news feeds) for our portal, XFINITY.com, from a variety of suppliers under contracts in which
we generally pay on a fixed-fee basis, on a per subscriber basis in the case of software product licenses or
on a video advertising revenue share basis in the case of content licenses.
To offer our voice services, we license software products (such as voice mail) from a variety of suppliers
under multiyear contracts. The fees we pay are generally based on the consumption of the related services.
We use two vendors to provide customer billing for our cable services.
Customer and Technical Services
Our customer service call centers provide 24/7 call-answering capability, telemarketing and other services.
Our technical services group performs various tasks, including installations, plant maintenance and upgrades
to our cable distribution system.
Technology
Our cable distribution system employs a fiber optic cable-based network architecture used in conjunction
with coaxial cable that we believe is sufficiently flexible and scalable to support our future technology require-
ments. This network provides the two-way transmissions that are essential to providing interactive video
services, such as On Demand, and high-speed Internet and voice services. We are also leveraging our IP
technology and the cloud computing services within our network to develop and deliver innovative services to
our customers efficiently and in an accelerated fashion.
We continue to develop and launch new technology initiatives, such as:
• enabling a variety of consumer electronic devices, including computers, tablets, smart-
phones and Internet-connected televisions, to search, control and display the programming
and other content we provide to our video customers
• expanding the use of our network to launch new services, including providing service to
medium-sized businesses and offering home security services
• developing and launching a next generation media and content delivery platform that lever-
ages IP technology and our own cloud network servers to deliver video and advanced
search capabilities to our customers on multiple devices
5Comcast 2011 Annual Report on Form 10-K