Charter adds 11K subs in 2015, declares no rate increases for 2016
After growing its video subscriber base for the first time in over a decade, Charter Communications (NASDAQ: CHTR) said it will be the only major operator not to raise customer pricing in 2016.
"If you're growing your residential subscriber base by 5 percent, there's not much you need to do," said Charter CFO Chris Winfrey during Thursday's earnings call.
Indeed, Charter added 33,000 video customers in the fourth quarter and 11,000 for the year, joining Time Warner Cable (NYSE: TWC) in breaking a decade-long drought of full-year growth.
Charter also added 450,000 high-speed Internet customers in the quarter, a 9 percent growth uptick from the fourth quarter of 2014.
"Our biggest growth opportunity is to take video share from other providers," said Charter President and CEO Tom Rutledge. "We think that in the places where we operate, our video share is about 50 percent. We think we have tremendous upside."
This competitive dynamic is also in play on the residential broadband side, he added.
Broadband "is an under penetrated business," Rutledge said. "If you look at the market share the telcos have in Internet services, and satellite companies have in video services, we have a lot of growth in front of us, and we have a lot of good products that are driving that growth."
Charter grew its revenue in the fourth quarter by 6.4 percent to $2.5 billion. Full-year revenue increased by 7.1 percent.
Addressing a wide range of topics broached by investors, Rutledge said Charter's pending merger with TWC and Bright House Networks is still being delayed through June because of the California Public Utility Commission's timeline. The MSO has petitioned the PUC to review the TWC merger earlier, but has not yet heard back, Rutledge said.
Rutledge said it was unlikely that Charter would to follow Comcast's (NASDAQ: CMCSA) lead and participate in the FCC's upcoming spectrum auction. "We're not exactly in the same place as Comcast," he said, because "we have this pending transaction. We don't know what our footprint is at this point, for example. It's difficult to participate without regulatory clarity."
Rutledge also seemed to indicate that Charter won't be as bullish as Comcast in deploying DOCSIS 3.1 networking technology. "It is possible that we'll deploy [DOCSIS 3.1] modems in lieu of 3.0 modems later this year, but we didn't plan for it," he said.
Asked about FCC Chairman Tom Wheeler's proposal to "unlock" the pay-TV set-top leasing business, Rutledge toed the party line: "We haven't seen the proposal, but think it's very dynamic marketplace, and business moving to app-based display and cloud-based display," he said. "We want to work carefully with the FCC to change the marketplace as it currently exists."
- visit this Charter investor relations site
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- 2Charter adds 11K subs in 2015, declares no rate increases for 2016