FWA 'another form of DSL,' Charter CEO says

Fixed wireless access (FWA) operators continue to add customers hand over fist while cable broadband subscriber growth stays sluggish. But Charter Communications CEO Chris Winfrey still believes FWA won't stand up to the demands of speed and bandwidth. In fact, he likens it to DSL – a product that had its moment but saw many customers flee to cable's higher-quality connections.

The initial success of FWA "shows there's a nice, niche market for limited-bandwidth, limited-capacity and limited-reliability product," Winfrey said Thursday at the Goldman Sachs Communacopia + Technology conference. "As consumer bandwidth needs increase over time and as the network capacity of these mobile networks shrinks as a result of the utilization, I think fixed wireless access turns into really just another form of DSL, particularly when you take a look at the capabilities of our network today and where we're going with high-split DOCSIS 4.0."

Winfrey added: "I think it [FWA] turns into the next DSL and a place of acquisition."

Figure 1:



(Source: Charter Communications)

What's not clear is when or if FWA will take such a turn. But the sooner the better for Charter and other cable operators. For its part, Charter added 70,000 residential broadband subs in the second quarter of 2023, a figure that was aided by the operator's network expansion efforts.

Winfrey also said he doesn't buy the notion that FWA holds a clear price advantage in the market, believing that Charter has the upper hand when home broadband and mobile are bundled.

All eyes on 'Spectrum One' promotion roll-off

Mobile, now a prime component in Charter's broadband bundling strategy, continues to serve as one of the operator's key growth engines. Charter has added 2.3 million mobile lines over the past four quarters, and 648,000 mobile lines in Q2 2023 alone.

Many industry watchers, including Charter's mobile competitors, are keeping a close eye as customers start to roll off a "Spectrum One" promotion that included a free line of mobile for a year.

Winfrey insists that many of those customers will keep their lines. Even as the price climbs from $0 to $30 per month, they still will save money over competitive alternatives, he said.

Charter tested multiple promotions in multiple markets last summer, including promos that became Spectrum One, and has found that the churn levels seen in roll-off period were lower than expected, Winfrey noted.

"We're really confident of what that means when it [the Spectrum One roll-off] happens at scale beginning in October. It'll stick," he said.

Charter-Disney dispute continues

Winfrey's talk also centered on Charter's carriage dispute with The Walt Disney Company and why Charter believed the time was right to take a stand and consider a different model for video.

Winfrey reiterated a position that Charter doesn't want to be forced to deliver packages and programming channels that consumers don't want or can't afford, and that the fees Charter pays to Disney are being used to fuel new direct-to-consumer (DTC) products that cause consumers to effectively "pay twice" for content.

Winfrey has previously said that Charter is prepared to "move on" without Disney content if the carriage dispute isn't resolved quickly. He suggested that Charter could instead focus on smaller and less expensive general entertainment packages and then resell services from virtual multichannel video programming distributors (vMVPDs) that provide Disney content and channels, including FX and ESPN.

"We all have a sense of urgency to resolve it quickly because our customers are stuck in the middle," Winfrey said, noting that there was no material progress in the negotiations with Disney to report.

But he believes the ball's in Disney's court. "In the end, Disney's the linchpin, ESPN's the linchpin … They have the opportunity to lead here and drive the industry. If it works, it's going to be because of them," Winfrey said.

Disney 'ready to resolve' dispute

Disney issued a new statement on the matter as Winfrey wrapped up his talk, pointing out that Charter had rejected multiple offers to extend the talks before Disney's networks were pulled from Charter on August 31.

"As the US Open reaches the men's and women's finals, and fans gear up for a weekend of college football and the opening of the NFL season, it's unfortunate that Charter decided to abandon their consumers by denying them access to our great programming," Disney said in a statement. "While they have stated their 'indifference' to the needs of millions of paying customers, we will not lose sight of what is most important – investing in the highest-quality stories, news and sports for our audience."

Disney added, "The question for Charter is clear: Do you care about your subscribers and what they're telling you they want – or not? Disney stands ready to resolve this dispute and do what's in the best interest of Charter's customers."

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— Jeff Baumgartner, Senior Editor,
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