Stamford, Norwalk carriers on opposite ends of spectrum
Charter Communications led all broadband companies for subscriber adds in 2017, according to a new study, with Frontier Communications ranked last of 14 providers.
Stamford-based Charter added 1.3 million Spectrum broadband subscribers to boost its count 5.5 percent, tops by either measure among major U.S. providers according to Leichtman Research Group, a Durham, N.H.-based market research firm.
Charter had 23.9 million broadband subscribers at the close of 2017, LRG determined, edging slightly closer to market leader Comcast, which upped its Xfinity subscriber base count by 1.1 million accounts to 25.9 million.
The study arrives even as Charter looks ahead to a new Stamford headquarters with plans to add 1,100 jobs in the city. Charter added 3,300 jobs last year to give it nearly 95,000 in all, after absorbing Time Warner Cable and Bright House Networks in 2016.
Speaking March 5 at a Deutsche Bank investment conference in Palm Beach, Fla., Charter CEO Tom Rutledge described as “excellent” how he sees Charter’s prospects for continuing to add broadband subscribers in the coming year.
“What we are really selling is connectivity relationships, and we think we can grow that — at pace — for many years to come,” Rutledge said in early March. “Our broadband product ... is really a better product than our competitors have. ... It’s faster and more reliable — and from a cost-per-bit perspective, less expensive.”
Both ends of the equation
Norwalk-based Frontier was one of four telephone companies to see erosion in its broadband customer base, dropping by 333,000 accounts to under 4 million, an 8.5 percent drop. Speaking last month to investment analysts, CEO Dan McCarthy predicted the company will turn the corner this year even as it continues to cut costs in an effort to return to profitability and reduce its debt burden.
“I would say that at this point we’re on the cusp of really moving into positive territory,” McCarthy said in late February. “We expect to try and improve both ends of the equation, so continuing to work on retention and churn, while at the same time really adding new channels to drive gross adds up a little further; and ... moving pricing in some cases up, associated with content price increases. And we really haven’t seen any material impact on churn as a result of that.”
Altice USA, which has the largest cable territory in southwestern Connecticut, pushed through the 4 million subscriber mark, as well, but on an upward trajectory, adding 84,000 households and businesses nationally for a 2.2 percent gain. Speaking the same day as McCarthy, Altice USA CEO Dexter Goei noted his company’s push to roll out fiber optic cable, including locally, to increase the broadband speeds it can offer customers, with the goal of marketing the new option by September.
“We continue to drive upgraded networks with consumers that are looking to consume more and more bandwidth, (and) we’ve got a pole position in terms of our competitive position in all of our markets,” Goei said. “We ... know that it takes a little bit of growing pains to get the machine moving — getting the right piece in place, getting the permits in place, getting all the processes, getting the trucks, all those things. Now we are moving at a very nice pace.”
The way the world will be
Rutledge said Charter is on the cusp of phasing in this year new technology that will allow it to amp up its broadband capacity to 10 gigabits per second and predicts Charter will need that capacity as businesses and households connect more devices to the Internet, and as they experiment with new tools. He predicted telephone companies will have difficulty keeping up with the copper-based DSL technology they use to provide high-speed Internet in large parts of their service areas, not including the fiber optic cable some have strung directly to homes like Frontier and Verizon Communications.
“There are virtual reality products, there are artificial intelligence products and augmented reality products,” Rutledge said. “There are going to be high-capacity communications products that are going to be used for work and for play and for entertainment. If you just look at the history of data use, that’s the way the world is going to be, and we have the network to provide that kind of connectivity.”
Alex.Soule@scni.com; 203-842-2545; @casoulman