As Charter Communications (Nasdaq: CHTR) prepares to convert its cable systems to an all-digital platform, the nation's fourth largest MSO may be thinking about switching to a new brand for its digital cable product, along the lines of Cablevision's (NYSE: CVC) Optimum or Comcast's (Nasdaq: CMCSA) Xfinity TV brands.
Charter CEO Tom Rutledge, who saw the success that Cablevision had with its switch to the Optimum brand when he ran the Dolan family's cable systems, was asked about Charter's digital cable branding strategy Friday morning on the company's fourth-quarter earnings call.
"Some people think we should change the Charter brand, that we should have tracker brands like Xfinity or Optimum. We don't have anything today to announce on that," Rutledge said.
It's a good bet that Charter will eventually switch to a new brand for its digital cable product that could distinguish the advanced video service from the days that Charter sold only analog cable. But it's likely that Rutledge won't make the switch until the majority of Charter's cable systems are ready to make the switch to an all-digital platform.
By turning off its analog signals and switching to an all-digital platform, Charter will be able to increase its HDTV channel capacity and offer subscribers faster broadband speeds. But converting to an all-digital platform can be disruptive for subscribers, since those that don't have digital set-tops connected to TVs will lose their pictures when operators make the switch. When Comcast switched to an all-digital platform in St. Johns County, Fla., last year, hundreds of subscribers who lost cable service formed lines at tents Comcast erected in a grocery store parking lot to pick up digital terminal adapters.
Rutledge said Charter will make the switch to all-digital in markets that have the highest penetration of digital cable set-tops. "The higher the [digital] sell-in, the less disruptive it is," Rutledge told analysts Friday.
Charter also plans to deploy a cloud-based interactive program guide that subscribers will be able to access from digital set-tops, smartphones and tablet computers, Rutledge said. Comcast and Cablevision have also deployed cloud-based program guides, and the product Rutledge described on Friday sounded similar to the Videoscape Unity platform from Cisco (Nasdaq: CSCO) that Cox Communications announced in January that it would deploy.--Steve