Charter Communications managed to lose another 100,000 traditional video customers, but more than made up for the losses with significant broadband growth. Like Comcast, Charter has increasingly benefited from telcos like AT&T, Verizon, CenturyLink, Windstream and Frontier simply refusing to upgrade their networks at any real scale. As a result, consumers are increasingly flocking to cable broadband if they want anything resembling next-generation broadband speeds. To that end, Charter added an impressive 428,000 broadband subscribers during the first quarter.
Still, with programming costs jumping 8.2% and the company's video subscriber base down 2% from this time last year, Charter still faces some headwinds.
Unlike Comcast, which uses arbitrary and unnecessary usage caps to help protect TV revenues from streaming video competition, Charter was banned from imposing caps for a period of seven years as a condition of its latest merger. Cable lobbyists have, however, already convinced the FCC to kill some of those conditions, and are pressuring the agency to kill the usage cap restrictions as well.
Charter's $79 billion acquisition of Time Warner Cable and Bright House hasn't been a good one for customers, who say the company's customer service post-merger has actually been somehow worse than the traditionally awful support the cable sector is already known for. Support representatives often provide conflicting information, and many users also say they're paying higher rates than ever before in the wake of the deal.
For its part, Charter CEO Tom Rutledge continues to insist the post-acquisition integration is going swimmingly.
“As we near the first anniversary of the close of our transformative transactions in May of last year, the execution of our integration and operating plan remains on track,” CEO Tom Rutledge says. “We have now launched our Spectrum pricing and packaging to nearly all of the homes we pass in our new footprint. We are already seeing the benefits of our customer-focused strategy in those markets, including greater connect volumes and the sales of higher quality products, all of which will lead to higher customer satisfaction, lower churn, and faster customer and financial growth in future quarters.”