Charter Revs Up Wideband, SDV Rollouts
During today's first-quarter call, Charter said it's on track to deploy Docsis 3.0 to half its systems, and to install switched digital video (SDV) to about 60 percent of its footprint by the year's end,
Charter has already introduced a 60-Mbit/s wideband tier in St. Louis, and is targeting other markets, where it typically comes up against AT&T Inc. (NYSE: T), Verizon Communications Inc. (NYSE: VZ), or a number of competitive cable overbuilders.
News of the Docsis 3.0 expansion comes as the MSO continues to beef up speeds of its single-channel cable modem tiers.
In March, the company bumped its "Express" tier to 8 Mbit/s down by 1 Mbit/s upstream; its "Plus" offering to 16 Mbit/s down by 2 Mbit/s up; and its "Max" tier to 25 Mbit/s down by 3 Mbit/s. At the time, the company noted that the D3-powered "Ultra60" tier was in "many" markets.
Charter indicated, also in March, that it had wideband available to about 1 million homes. Light Reading Cable is trying to track down those individual markets, but we're told in the interim that Charter also has D3 up in some systems serving parts of California, Massachusetts, Minnesota, Connecticut, Nevada, and Tennessee. Missouri is also on that list, but it's not immediately clear yet if Charter's rolled wideband to any cities there beyond St. Louis. (See Charter Passes 1M Homes With Docsis 3.0.)
Charter is also revving up plans for SDV, a bandwidth-saving technique that delivers channels in a "switched" tier only when a home in a given service group selects it for viewing. (See Charter Charts First SDV Course .)
Charter will be relying more heavily on SDV to help free up room for more HD and on-demand content as the year goes on, but it's also starting to test out an analog reclamation strategy popularized by Comcast Corp. (Nasdaq: CMCSA, CMCSK) that leans heavily on simple Digital Terminal Adapter (DTA) digital-to-analog converter boxes. Charter chief technology officer and EVP of operations Marwan Fawaz said the MSO is testing that approach in one still-unidentified market. (See Comcast's $1B Bandwidth Plan .)
And it's clear that Charter will look at both options as its bandwidth management plan evolves. "I don't think there's a one-size-fits-all approach when it comes to the Charter footprint," said Charter's new permanent president and CEO Mike Lovett.
Charter, which polished off its bankruptcy reorganization last November, continues to show improvements in its financial picture. (See Charter Leaves Chapter 11 .)
The MSO posted first-quarter revenues of $1.74 million, up 4.5 percent year-on-year, helped along by gains in its Internet, voice, and commercial services businesses. Charter also posted net income of $24 million (21 cents per share), versus a year-ago loss of $205 million (54 cents per share). (See Charter Reports Q1.)
Among the bright spots, revenues at the business services unit jumped 10.3 percent, to $118 million, as it continues to invest in carrier backhaul, hotel services, new Ethernet-over-coax offerings, and other ways to help it target larger commercial customers.
On the subscriber front, Charter still lost about 23,400 basic video subs, giving it a total of 4.8 million. It made up for that with gains in its other service areas in the quarter, adding 95,800 digital video subs, 103,700 high-speed Internet customers, and 66,900 phone subs.
Charter hopes to begin trading on Nasdaq later this year.
— Jeff Baumgartner, Site Editor, Light Reading Cable