Charter Communications\u00a0CEO Chris Winfrey said he wants customers to think of reliability and credibility when they think of their cable and broadband provider.<\/p>\n
The cable giant told CNBC it is unveiling a series of changes Monday to bolster that goal, including rolling out new bundles and pricing, increasing internet speeds, offering credits for service outages and promising heightened reliability for customers.<\/p>\n
Charter \u2014 which provides broadband, cable TV and mobile services and is known to customers under the name of Spectrum \u2014 said it is also trying to make the company more approachable and remove the longtime negative connotations around cable companies by announcing Spectrum\u2019s new \u201cfirst-of-its-kind customer commitment,\u201d branded as \u201cLife Unlimited.\u201d<\/p>\n
The rollout comes as Charter and its industry peers contend with several trends: slowing broadband customer growth, continued defections from the cable TV bundle, and a young but speedily expanding mobile business.<\/p>\n
\u201cIt is hard to be loved when you\u2019re providing a critical service to the household that\u2019s a physical infrastructure that charges over $100 a month,\u201d Winfrey said in an interview with CNBC. \u201cAnd to the extent there\u2019s a problem, sometimes somebody has to enter your home \u2026 in the same vein that it is for an electrician or plumber.\u201d<\/p>\n
The first step to changing a less-favorable consumer view is with \u201cpricing and packaging that creates more value than you can replicate anywhere else in the marketplace,\u201d he said.<\/p>\n
Spectrum said it will charge as low as $30 a month for its 500Mbps internet plan, or $40 a month for 1GB service, when either are bundled with two mobile lines or cable TV. The company is also increasing the baseline internet speed for current customers at no additional cost.<\/p>\n
The company also said it\u2019s planning to be upfront about costs. Under its new plan, taxes and fees are baked in, there are no annual contracts and pricing is guaranteed up to three years, it said. Charter even eliminated the 99 cents it had tacked on to most of Spectrum\u2019s pricing in the past.<\/p>\n
In addition, Spectrum pledged to give customers credits when the company\u2019s customer service doesn\u2019t live up to its promises, or for internet outages that are out of the customer\u2019s control but are due to an issue on the company\u2019s part and last more than two hours. Service issues such as those caused by weather, natural disasters or power outages don\u2019t count.<\/p>\n
Life Unlimited \u2014 a new platform for Spectrum\u2019s internet, mobile and TV services \u2014 will roll out across its 41-state footprint this week, the company said.<\/p>\n
\u201cWe wanted to make a bold statement about our commitment and our capabilities,\u201d Winfrey said. \u201cWe also wanted to recognize that we\u2019re not perfect and we\u2019re putting ourselves under pressure, concrete pressure, to make sure that we can be a better service operator every month and every year from here on out.\u201d<\/p>\n
The announced changes are some of Charter\u2019s biggest moves since Winfrey\u00a0took the helm\u00a0as CEO in December 2022.<\/p>\n
He\u00a0followed\u00a0Tom Rutledge, who held the post for a decade and turned a relatively small cable operator into the second-largest cable company in the U.S. through the\u00a0takeovers\u00a0of Time Warner Cable and Bright House Networks in 2016. Winfrey was CFO at the time and spearheaded the mergers.<\/p>\n
Winfrey recalled the various investments and advancements cable companies had made over the years: namely in broadband, but also in the pay TV bundle and the landline and mobile phone businesses.<\/p>\n
\u201cFor all the value that the industry\u2019s brought over the years, and the service and reliability investments that we\u2019ve made, we haven\u2019t always gotten the full credit that we deserve, and in some cases, we did get the credit we deserve because we could have done things better,\u201d Winfrey said.<\/p>\n
He entered the top job at a moment when it was clear growth was unlikely to return to the cable TV bundle.<\/p>\n
Winfrey had been a low-key and not widely known executive\u00a0in the media industry, but he started off swinging.<\/p>\n
At an investor day in December 2022, Charter announced an aggressive capital investment plan that included putting $5.5 billion over three years in its broadband infrastructure network. The higher-than-expected spending during a time of growing competition from 5G wireless providers sent alarms through Wall Street, and the stock dropped.<\/p>\n
Charter\u2019s stock price has\u00a0fluctuated\u00a0greatly in recent years. On Sept. 12, 2021, the stock price was $787.12. It closed at $340.17 on Friday.<\/p>\n
Charter\u2019s stock has fluctuated in recent years as there\u2019s been a slowdown in broadband subscriber growth.<\/p>\n
That\u2019s in part because broadband customer growth at providers including Charter and\u00a0Comcast\u00a0has\u00a0struggled, according to the companies\u2019 earnings reports. Increased competition from wireless companies such as\u00a0AT&T\u00a0and\u00a0Verizon\u00a0has also played a role in the stagnation, as has the slowdown in the buying and selling of houses due to high interest rates.<\/p>\n
The third quarter was the worst ever for broadband industry subscriber losses, according to MoffettNathanson. Charter lost 149,000 subscribers and had a total of 30.4 million residential and small business broadband customers as of June 30, according to its second-quarter earnings report.<\/p>\n
While the losses weren\u2019t as substantial as analysts had feared, Charter\u2019s growth bright spot is now its mobile business, which\u00a0launched\u00a0in 2018. Spectrum Mobile has 8.8 million total lines and has grown rapidly due to enticing promotional deals and increased mobile usage on reliable Wi-Fi networks, the company said.<\/p>\n
In late 2022, Charter\u00a0announced\u00a0its \u201cSpectrum One\u201d plan, the first time it offered broadband, Wi-Fi and mobile in a bundle with promotions that included competitive rates and, in some cases, free mobile lines.<\/p>\n
\u201cFor wireless, the \u2018Spectrum One\u2019 promotion will almost certainly turn out to have been a home run,\u201d analyst Craig Moffett said in a research note in July. \u201cDespite the fact that it was initially viewed as shockingly aggressive, it was, in fact, a rather modest offer.\u201d<\/p>\n
Moffett called mobile an \u201cunderappreciated growth engine\u201d for Charter, not only because of customer additions but also growth in average revenue per user, or ARPU, which is a metric often used by cable companies.<\/p>\n
Winfrey doesn\u2019t expect ARPU to be affected by the new promotions.<\/p>\n
\u201cWhen I think about Wall Street, I think about the customer,\u201d Winfrey said. \u201cIf you focus on the customer, provide great customer service, save them money, provide value, then your capital market strategy, your regulatory strategy, all of that just falls into place.\u201d<\/p>\n
Customers have been dropping pay TV rapidly across all providers, including Charter. But the company has been vocal about its efforts to preserve the business, especially under Winfrey\u2019s leadership.<\/p>\n
The biggest moment came in 2023 when\u00a0Disney-owned networks\u00a0went dark\u00a0for Charter\u2019s customers and Winfrey called the pay TV ecosystem \u201cbroken\u201d as he pushed for a revamped deal with Disney.<\/p>\n
While these disputes are common \u2014 Disney and DirecTV on Saturday ended a roughly two-week\u00a0blackout fight\u00a0\u2014 this one was different in the age of streaming.<\/p>\n
For Charter, the sticking point wasn\u2019t just the fees. The company wanted Disney\u2019s ad-supported streaming options to be part of its TV offering.<\/p>\n
Pay TV providers often say the rates that programming companies such as Disney seek from them are too high, especially since the programmers are also funneling much of their content into streaming platforms. Although the cable bundle loses customers, cable providers note it\u2019s still a cash cow while streaming chases profitability.<\/p>\n
\u201cCredit to Disney, eventually they were willing to lean in and they understood their role in the industry,\u201d Winfrey said, adding that ESPN is considered the linchpin of the cable TV bundle. \u201cThey had to be the leader in the space, and we knew that.\u201d<\/p>\n
The\u00a0deal\u00a0allowed for ad-supported Disney+ and ESPN+ to be included in \u201cSpectrum TV Select\u201d packages. In addition, when ESPN launches its direct-to-consumer streaming option \u2014 which is expected\u00a0to debut\u00a0in fall 2025 \u2014 these customers will receive access to it, too.<\/p>\n
\u201cI give Charter a ton of credit because they walked into the room and they had very specific ideas. They had a vision that they wanted to execute against, and again, it was a hard negotiation,\u201d ESPN Chairman Jimmy Pitaro\u00a0said on CNBC\u00a0on Sept. 3\u00a0when discussing the blackout fight with DirecTV.<\/p>\n
Depending on the tier a customer subscribes to, their package can include the ad-supported versions of streamers Disney+, ESPN+, Max, Discovery+, Paramount+, AMC+, BET+ and\/or Televisa Univision\u2019s Vix.<\/p>\n
The deals have also given Charter the opportunity to sell and market the streaming services to its broadband-only customers \u2014 and includes a revenue share agreement.<\/p>\n
The most recent\u00a0deals\u00a0with\u00a0Warner Bros. Discovery\u00a0and\u00a0AMC Networks\u00a0were\u00a0early renewals. That\u2019s relatively uncommon in an industry where carriage negotiations often come down to the wire.<\/p>\n
Charter last year also\u00a0started\u00a0offering its own streaming devices, known as Xumo, through a joint venture with Comcast. The device gets rid of the cable box and gives consumers a way to access both their cable TV and streaming apps in one place.<\/p>\n
\u201cWe still have hurdles to get through,\u201d Winfrey said, noting that Charter\u2019s goal is to offer all ad-supported streaming apps owned by the major programmers it negotiates with on the cable TV bundle in the first half of 2025.<\/p>\n
NBCUniversal\u2019s Peacock is still not part of that roster, however. A Charter representative said the company doesn\u2019t discuss renewals and declined to comment.<\/p>\n
Disclosure:<\/em>\u00a0Comcast is the parent company of NBCUniversal, which owns CNBC.<\/em><\/p>\n<\/p>\n Charter Communications\u00a0CEO Chris Winfrey said he wants customers to think of reliability and credibility when they think of their cable and broadband provider. The cable giant told CNBC it is unveiling a series of changes Monday to bolster that goal, including rolling out new bundles and pricing, increasing internet speeds, offering credits for service outages […]<\/p>\n","protected":false},"author":0,"featured_media":9686,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-9685","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/9685","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=9685"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/9685\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/9686"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=9685"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=9685"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=9685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}