Cable TV CEO Is ‘Surprised’ That 1.3 Million Out of Of His 5.5 Million Customers Want The Internet But NOT Television
November 6, 2013 Leave a comment
Cable TV CEO Is ‘Surprised’ That 1.3 Million Of His Customers Want The Internet But NOT Television
JIM EDWARDS NOV. 5, 2013, 4:27 PM 3,080 16
Tom Rutledge, the CEO of cable TV company Charter Communications, told Wall Street this week he was “surprised” that 1.3 million of his 5.5 million customers don’t want TV. They just want broadband internet. They’re actively NOT subscribing to TV in addition to the web. “Our broadband-only growth has been greater than I thought it would be,” he added. Rutledge is not alone. A lot of people are having difficulty processing the idea that now it’s so easy to watch shows or movies online, whenever you want, that cable and broadcast TV just aren’t something that everybody wants anymore.People thought that “cord-cutters” were merely switching from cable TV to broadband internet. They were keeping the pipes that come into their houses, in other words, and using them differently. Maybe they were still watching TV if TV came as a cheap bundle with internet. (It’s noteworthy that all the major cable/telco companies still have thriving hard-wired telephone businesses too, even though may people never use them — because they come with the bundle.)
But recent subscriber stats show a net loss across all three services — TV, web and phone.
We have a pet theory at Business Insider: Because it’s a lot easier now to survive on free wifi, people who already cut the cable TV cord are now cutting all cords, and living entirely off wifi that comes from businesses, cities and campuses.
Here’s what Rutledge said on his quarterly call with analysts. He was asked by Morgan Stanley analyst Benjamin Swinburne, “Do you think the pay TV penetration in that base is declining?”:
Thomas M. Rutledge – Chief Executive Officer, President and Director: … I would say that the one thing that surprised me — has surprised me about Charter is that our broadband-only growth has been greater than I thought it would be. And part of that, I think, is some change in the world that is going on with consumers. But the bigger part of it is that Charter’s video product was inferior, and we had brand issues around that. And so I think while you can see some of these trends occurring throughout the whole industry, it’s more exaggerated at Charter, I think, because of the way we let our video product deteriorate, and we’ve turned that around. And I see the 1.3 million broadband-only customers as a real selling opportunity for us from a video perspective.
The Wall Street Journal notes that Charter had some specific issues that made its TV product worse than it needed to be. So this may merely be an anecdote rather than a harbinger of the underlying trend.
But still, if you were looking for the “Death of TV,” this is the kind of thing you’d expect to see.
About bambooinnovator
Bamboo Innovator 