The CEO of Charter Communications, Tom Rutledge, recently made a statement in which he downplayed the growing threat of cord cutting even though some experts in the field of telecommunications are still obsessed over the subscription losses at ESPN. Rutledge said, “The whole MVPD [multichannel video programming distributor] marketplace has shed about 3 million customers over five years how. Some people are talking about Disney, with ESPN losing 11 million customers over that period of time I do think there will be some chipping around the margins.”
“It used to be when a young guy went off to college, if he lived off-campus, he’d subscribe to cable to get ESPN, but now he gets it over-the-top from his parents’ account,” Rutledge added. “So a lot of the loss on margin is really about lack of security and the inability of content companies which are becoming distributing companies controlling where their product goes.”
He continued by stating “If you look at the whole pie, the vast majority of people are still subscribing to a video package and an MVPD package, at that.” Rutledge also added that he discovered the different promotional offers offered by his company right after Charter acquired Time Warner Cable. He added that several customers opted out of their service once the promotional period ended. “It was a Turkish bazaar,” he said.
The Charter CEO also added that the cable service of the company passes approximately 50 million homes but just 26 million of them have subscribed to their services. He indicated that the growth of the service would come through marketing to the non-subscribers and more consolidation. However, Rutledge acknowledged the fact that there are not many companies left for Charter Communications to acquire.
“I love the cable assets and think they’re good. If they were available, they would be interesting to me,” He said. When asked about the acquisition of a content company, Rutledge said, “You have to run it as a programming business. It’s hard to run it for your own internal purposes. I see that as a fundamental issue with owning content.”
Charter is also one of the leading internet providers in the country and they have been offering attractive internet packages to their customers for a very long time. In fact, with their cheap internet deals and TV packages, Charter has made a place for itself among the top players in the industry.