Charter Cuts Q1 Video Sub Loss More Than 50%

Cable operator Charter Communications May 1 disclosed it lost 70,000 Spectrum video subscribers in the first quarter ended March 31. The loss was 54% less than the 152,000 subs lost in the previous-year period.

The distributor added 563,000 high-speed Internet customers, up 41% from 398,000 new broadband subs last year. Spectrum ended the period with 29 million cable, Internet and voice subscribers in 41 states, including 15.5 million video. The latter down 402,000 video subs in the past 12 months.

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Charter several years ago bowed Spectrum TV Plus, a $12.99 monthly online TV service for its broadband-only subs. The service included a free Roku player. Last year Charter unveiled “TV Essentials,” a $15 monthly “skinny bundle” option for pay-TV subs.

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“Thanks to the dedication of our employees and the quality of our network, we have continued to deliver high quality connectivity services to millions of existing and new customers in the communities we serve, including homes, businesses, hospital and educational systems, and local, state and federal government institutions,” longtime CEO Tom Rutledge said in a statement.

ViacomCBS, Charter Close Funding (Debt) Initiatives

With a traditional media revenue businesses turned upside down by the coronavirus, and not wanting to wait for government bailouts, ViacomCBS and Charter Communications are the latest content creator/distributors to seek outside funding (and debt) to sustain operations.

Charter April 17 announced the closing of $3 billion in bonds, which include $1.6 billion of senior secured notes due in 2031, and $1.4 billion of senior secured notes due in 2051.

Separately, ViacomCBS said it would redeem all of its outstanding senior notes due on Feb. 15, 2021, and all of its outstanding senior notes due on March 1, 2021. The separate aggregate amounts of senior notes disclosed April 17 included $300 million and $500 million, respectively.

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The moves come on the heels of major Hollywood players going to Wall Street in search of funding sources. AT&T sought upwards of $5 billion in loans, while Discovery pulled the trigger on $500 million of its credit line. Comcast sold $4 billion in debt while The Walt Disney Co. secured a $5 billion loan from Citibank.

“Right now, it’s all about liquidity,” Neil Begley, SVP of corporate finance group, told The Hollywood Reporter.

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WarnerMedia and Charter Announce Distribution Agreement for HBO Max

WarnerMedia and Charter Communications have entered into a new multiyear distribution agreement that will make HBO Max, WarnerMedia’s upcoming streaming platform, available to Charter customers when it launches in May.

Through the pact, all of Charter’s existing HBO subscribers, including subscribers in its Spectrum Silver and Gold video packages, will automatically be given access to HBO Max at no additional charge and with no action required other than signing into the HBO Max app. All remaining and new customers will be able to purchase HBO Max directly from Charter.

“Charter has been a longtime distributor of our networks and on-demand content, and a valued partner to our company,” said Rich Warren, president of WarnerMedia Distribution, in a statement. “We look forward to working together to bring HBO Max to Spectrum subscribers when the product launches next month.”

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“We are eager to provide Spectrum customers with the highly-anticipated HBO Max offering when it makes its debut next month,” Tom Montemagno, Charter’s EVP of programming acquisition, said in a statement. “This new premium streaming experience will be a welcome addition to Spectrum subscribers; we will offer HBO Max on a multitude of platforms for purchase by our video, broadband and mobile customers alike.”

New Disney-Charter Deal ‘Contemplates’ Disney+ Access

Chalk up another positive for Disney+: The Walt Disney Co.’s much-hyped new subscription video-on-demand (SVOD) service, set to launch in November, may be available to Charter Communications subscribers.

A new distribution deal between Disney and Charter, announced Aug. 14, calls for the country’s No. 2 cable operator to continue carrying Disney’s TV and ESPN programming to Spectrum TV subscribers.

The deal also “contemplates Charter’s future distribution of Disney’s streaming services, including Hulu, ESPN+ and the soon-to-be-launched Disney+,” according to a press release issued by Charter.

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The deal wouldl help Disney+ in its attempt to compete with established streaming titans Netflix and Amazon.com.

In addition, Spectrum TV will also offer customers access to ESPN’s upcoming ACC Network when it launches Aug. 22.

Under the deal, Spectrum TV will continue to provide its customers widespread access to ABC, Disney Channel, Disney Junior, Disney XD, Freeform, ESPN, ESPN2, ESPN3, ESPNU, ESPNEWS, ESPN Deportes, ESPN Goal Line, ESPN Bases Loaded, SEC Network, Longhorn Network, and the newly acquired networks of FX, FXX, FXM, Fox Life, National Geographic, Nat Geo Wild, Nat Geo Mundo and BabyTV.

“This agreement will allow Spectrum to continue delivering to its customers popular Disney content, makes possible future distribution by Spectrum of Disney streaming services, and will begin an important collaborative effort to address the significant issue of piracy mitigation,” said Tom Montemagno, EVP of programming acquisition for Charter.

Sean Breen, SVP of Disney Media Distribution, added: “Our new agreement with Charter allows us to continue serving Spectrum TV customers with the full value of the Walt Disney Television and ESPN networks, including the newly acquired FX and Nat Geo networks. ACC fans can also rest assured that they will be able to watch their favorite teams on Spectrum, one of the largest distributors across the ACC footprint, when ACC Network launches next week.”

Charter’s Spectrum TV App on Apple TV

Charter Communications has launched the Spectrum TV App on Apple TV.

Nearly 50 million homes across Charter’s footprint now have access to live channels and tens of thousands of programs on the Spectrum TV App for Apple TV, according to Charter.

Additionally, starting next week and expanding throughout 2019, new and existing Spectrum TV and Internet customers can get an Apple TV 4K as part of their monthly subscription for $7.50/month plus tax for 24 months, according to Charter.

Charter is the first U.S. based cable operator to offer customers the new zero sign-on experience from Apple, which further simplifies signing in to video apps on Apple TV, according to Charter. When first set up in a Spectrum household, Apple TV 4K or Apple TV (4th generation) will detect the Spectrum customer’s broadband network and automatically sign them in to the Spectrum TV App and all the supported apps they receive through their service — with no need to enter a username and password, according to Charter.

The new Spectrum TV App is also integrated with the Apple TV app and Siri.

“We are bringing our customers the most robust Spectrum TV App experience available today through Apple TV,” said Rich DiGeronimo, Charter’s EVP, products and strategy, in a statement. “With features like zero sign-on and Apple TV app integration, the Spectrum TV App on Apple TV delivers the best and most seamless viewing experience, giving customers even greater choice and flexibility to enjoy Spectrum TV.”

“With Spectrum TV on Apple TV 4K, customers can now enjoy the ultimate entertainment experience across their iPhone, iPad and Apple TV,” said Greg Joswiak, Apple VP of product marketing, in a statement. “We want to help customers get right to watching their favorite channels, shows, movies and sports, and with innovative features like zero sign-on, the Apple TV app and Siri, they are able to jump right in.”

DirecTV Launching Proprietary Streaming Media Device in 2019

As expected, DirecTV plans to roll out a proprietary streaming media device in 2019 that would enable consumers to access online TV service DirecTV Now using their own broadband or high-speed Internet connectivity.

The device, which would be similar to a Roku or Apple TV device, would help DirecTV reduce subscriber acquisition costs typically associated with the installation of pay TV service, including truck rolls and employees climbing the roof installing satellite receivers.

Speaking Nov. 14 at the Morgan Stanley European Technology, Media & Telecom confab in Barcelona, AT&T CFO John Stephens said the streaming device would afford DirecTV with the same data insights and targeted advertising (driven by data analytics subsidiary Xandr) as linear pay-TV.

“It’s a device that allows us to instead of rolling a [service] truck to the home, we roll a UPS or FedEx truck to the home,” he said.

The executive said the box would help AT&T boost broadband subscriptions, which currently total about 15 million households.

“We certainly hope it’s our own fiber, but it can be on anybody’s broadband,” Stephens said.” “We are testing it with employees today.”

Charter Communications followed a similar strategy in 2015 when it launched standalone online TV service Spectrum TV Plus to broadband customers. New subs were given a free Roku 3 streaming media device to facilitate the $20 monthly service.

Separately, Stephens said oral arguments in the Justice Department’s appeal of the $85 billion AT&T/Time Warner merger are due Dec. 6 – with a decision by the three-judge panel expected next year.

“Quite frankly, we’re confident the decision will be upheld,” he said. “It’s a process we have get through. But we’re not spending a lot of time thinking about it.”

 

Charter Spectrum Softens Q3 Video Sub Loss

Charter Communications Oct. 26 disclosed it lost 66,000 video subscribers in the third quarter, ended Sept. 30, and improvement from 104,000 video subs lost in the previous-year period.

The nation’s third largest pay-TV operator (after acquiring Time Warner Cable and Bright House Networks) attributed the reduction to sales of standalone online TV service Spectrum TV Streamand Spectrum TV Choicevideo packages. It ended the period, however, with 16.1 million video subs – down 258,000 subs from 16.39 million reported last year.

“At the end of 2018, our integration of legacy TWC and Bright House will be largely complete, and we will operate as a single company, with a superior product and value proposition,” CEO Tom Rutledge said in a statement.“With significantly less customer-facing change in 2019, we expect continued improving service metrics with higher demand and retention, faster growth and falling capital intensity, driving meaningful free cash flow growth.”

Indeed, Charter added more than 1 million high-speed broadband customers in the past 12-month period, ending the quarter (266,000 net additions) with 23.3 million.

Charter Ups Hospitality Video Spectrum

Cable operator Charter Communications is joining other pay-TV providers in expanding its over-the-top video and broadband services to the hospitality market, which includes hotels, hospitals and universities, among others.

Charter June 19  announced expansion of its “Enterprise TV Portfolio,” offering third-party retail and consumer-facing businesses the same type of digital video entertainment options found in the home.

Options include “Fiber Connect Plus TV,” featuring HDTV video programming delivered over fiber without the need for a converter box. This platform helps to engage and inform hotel guests, hospital patients, university students and enterprise employees without the requirement of any expensive head-end equipment on-premises.

Charter’s “Set-Back Box TV” provides a customizable video service to help inform and entertain hotel guests and hospital patients with a homelike TV viewing experience. The platform delivers HDTV programming to the premise via coax and then is distributed to slim, compact set-back boxes that are mounted behind each television. It features an interactive program guide, the ability to pause live TV and a library of over 7,000 hours of on-demand content.

 “SpectrumU TV” is an over-the-top video streaming service delivering live TV, with local channels and regional sports networks, interactive program guide and an on-demand content. It is available to students on campus via a wired or wireless network using iOS and Android mobile devices as well as Mac and PC compatible tablets, laptops and desktops.

“Hotels, hospitals and universities want a TV solution that fits the needs of their guests, patients or students,” Peter Agnvall, VP, Enterprise TV, Spectrum Enterprise, said in a statement. “Our new offerings meet these demands with extensive programming packages available on multiple platforms which deliver a superior viewing experience, either as stand-alone offerings or in conjunction with a third-party solution.”

 

Apple Previews New Operating System for Apple TV 4K, Announces Deal With Charter

Apple June 4 previewed the tvOS 12 operating system for Apple TV 4K with support for Dolby Atmos audio, new features to easily access shows and movies, and aerial screensavers shot from space. The company also announced that Charter Communications, the second-largest cable operator in the United States, will begin offering Apple TV 4K to its customers.

Apple TV 4K debuted last fall. The service offers customers the largest collection of 4K HDR movies, according to Apple, including free 4K HDR upgrades to previously purchased movies in customers’ iTunes libraries.

“This fall, iTunes will be home to the largest collection of Dolby Atmos-supported movies anywhere, and these titles will also include Dolby Atmos audio for free,” according to an Apple press release. “With tvOS 12, Apple TV 4K will be the only streaming player both Dolby Vision and Dolby Atmos certified, delivering the highest quality cinematic experience of stunning 4K HDR visuals and immersive sound that flows all around in three-dimensional space.”

Also, later this year, Charter customers in nearly 50 million households will have access to live channels and tens of thousands of on-demand programs via an all-new Spectrum TV app on their Apple TV 4K, iPhone and iPad, integrated with Siri and the Apple TV App, Apple reported. In addition, as part of this collaboration, Charter will be offering iPhones and iPads to customers as they grow their mobile presence. Charter joins AT&T’s DirecTV Now in the United States, CANAL+ in France and Salt in Switzerland, which have begun offering customers Apple TV 4K with their services.

The Apple TV App on iPhone, iPad and Apple TV allows customers to find and watch TV shows and movies from more than 100 participating video apps in 10 countries, according to Apple. Single sign-on for Apple TV and iOS has allowed users to sign in once to get access to all the video apps available through their cable subscription. With tvOS 12, Apple further simplifies the authentication process with “zero sign-on.” Apple TV detects the user’s broadband network and automatically signs them in to all the supported apps they receive through their subscription — no typing required, according to Apple. Zero sign-on begins with Charter later this year and will expand to other providers over time.

In collaboration with the International Space Station National Lab and the Center for the Advancement of Science in Space, Apple unveiled new aerials shot from space by NASA astronauts, “so Apple TV customers can enjoy even more stunning scenes filmed in 4K HDR,” according to Apple. Aerial screensavers will also be more interactive, allowing viewers to see the location information and swipe between dozens of aerials, the company noted.

Additional tvOS 12 features for Apple TV 4K and Apple TV 4th generation make it easier for customers to access shows and movies, according to Apple:

— With iOS 12, users can securely AutoFill passwords from iPhone and iPad to Apple TV to easily sign in to Apple TV apps.

— The Apple TV Remote will be automatically added to Control Center on iPhone or iPad for Apple TV users, giving users quick access to Apple TV controls.

— Home control systems such as Control4, Crestron and Savant can be used to control Apple TV, including using Siri for voice search and control.

“The arrival of Dolby Atmos on Apple TV, ‘zero sign-on,’ a deal with Charter Spectrum, a new TV OS and, perhaps more tangentially, Siri support for third-party apps, all point towards an evolutionary product, rather than a revolutionary one, which we have become accustomed to from Apple over the years,” read a Futuresource Consulting blog in response to the announcements.

Futuresource estimates that there were approximately 21 million Apple TVs in use worldwide at the end of 2017, approaching half of these in the United States.

“Apple TV continues to add features, build partnerships and is clearly striving to offer the best quality digital streamer experience there is — albeit at a higher price than its competitors,” read the Futuresource blog. “Service partnerships will therefore be key to driving the attractiveness of the product and a channels approach, akin or better than Amazon Channels and Roku’s equivalent, will also be hugely important if Apple still wants to become the main entertainment hub in the home — something which Amazon arguably has gained a lead in.”

The new tvOS will be available this fall as a free software update for Apple TV 4K and Apple TV 4th generation. For more information, visit apple.com/apple-tv-4K.

Report: Multichannel Subscriptions Fall Slightly in Q1, But Get Virtual Lift

Combined cable, direct broadcast satellite (DBS) and telecom multichannel subscriptions fell 0.8% sequentially in the first quarter ended March 31, to 93.2 million, including 90.3 million residential customers.

That’s according to the Q1 2018 U.S. Multichannel Subscriber Report by Kagan, a media research group within S&P Global Market Intelligence.

However, noteworthy gains for virtual platforms DirecTV NOW and Sling TV cut the quarterly subscription losses in half, raising the overall residential figure to 94.1 million.

Other findings:

  • The residential multichannel penetration rate stood at 76.1% as of March 31 when including the virtual smartphone platforms owned by AT&T and DISH Network (DirecTV NOW and Sling TV).
  • Cable operators logged their largest first-quarter video subscriber decline on record, with the top two multiple system operators, Comcast and Charter, accounting for 59% of the drop.
  • Telco video appears to be regaining its footing as AT&T’s U-verse stabilizes. The platform’s video customer losses fell below 100,000 for the first time since the third quarter of 2015.
  • DBS losses ramped back up in the first quarter, bringing the sector’s total down to 31.1 million.For more information, visit www.spglobal.com/marketintelligence.