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Charter: Wideband Arriving Soon

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner

Charter Communications Inc. is inching closer to its first deployment of speedier Internet services based on the CableLabs Docsis 3.0 platform, but it's deliberately taking a much more cautious view when it comes to developing a wireless strategy.

"We're launching Docsis 3.0 in the next couple of months, which will enable us to offer Wideband speeds to our customers," Charter president and CEO Neil Smit said Thursday during the MSO's third-quarter earnings call. (See Charter Posts Q3.) "We continue to invest in areas with the highest expected return, and remain disciplined in our operating and capital expenditures."

In September, Smit told investors at a conference that it will cost the MSO about $8 to $10 per sub to wire up systems for Docsis 3.0. That "network enablement" figure includes the necessary, new cable modem termination system (CMTS) equipment and routing gear. It does not factor in the costs of the Wideband modems or the costs associated with provisioning those devices. (See Charter Talks Docsis Costs.)

Smit was less clear about where and how rapidly the St. Louis-based operator will launch Docsis 3.0 services in the early going. Fellow MSO Comcast Corp. (Nasdaq: CMCSA, CMCSK) just expanded its Wideband rollout to several new markets and expects to have all its systems ready for Docsis 3.0 by mid-2010. (See Comcast Enters the Wideband Era and Comcast Takes 'Wideband' Wider .)

At present, AT&T Inc. (NYSE: T) overlaps about 60 percent of Charter's cable footprint, while Verizon Communications Inc. (NYSE: VZ) overlaps about 40 percent.

Although Charter will likely introduce Docsis 3.0 to counteract U-verse and FiOS pockets, the MSO hasn't indicated what speed tiers it will deliver with the new platform. But, if Charter follows today's Wideband service trends, don't expect to see any that breach the 100 Mbit/s (downstream) mark, at least not yet. Today, Charter's high-end (non-Wideband) tier is 16 Mbit/s (down), and, for "cost-conscious dial-up and DSL users," has introduced a bundle that ties a 1 Mbit/s Internet tier with an in-state phone service.

Not waxing wireless... yet
Charter is still staying on the wireless sidelines as many of its MSO peers in the U.S. move ahead with mobile plans based on mix of 3G, long-term evolution (LTE), WiMax, and WiFi technologies. (See Cable Plays Clearwire Card, Cox Wireless: Soup to Nuts , Cox Preps Cellular Network, Eyes LTE, Cablevision Doubles Up on WiFi, and Cablevision Plays WiFi Card .) Charter was not involved in the now-defunct "Pivot" partnership with Sprint. (See MSOs Pivoting Away From Sprint JV.)

"I think with our wireless strategy, we're in a wait-and-see mode," Smit said. "We don't mind being in quick follower mode in that regard, [but] we think there's opportunity in that market."

He said questions remain as to how a cable/wireless play impacts business -- whether it's purely revenue-based or a driver for customer retention. "We'll see how it evolves and look at it as the product and the business model evolves," Smit said.

— Jeff Baumgartner, Site Editor, Cable Digital News

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