Charter running steep 1-Gig promo in KC area

Charter Communications is running a promotion in the Kansas City, Missouri, area that pitches a 1-Gig broadband service for $39.99 per month for a period of two years.

Under terms of the promotion, currently available in areas such as Sedalia and Warrensburg for customers who take Charter's auto-pay option, Charter is also tossing in a $100 Visa Rewards Card and offering a line of Spectrum Mobile for 12 months.

According to Charter's latest pricing data for multiple addresses in the Sedalia area, Light Reading found that Charter's promotional price for 1-Gig is the same as its 300 Mbit/s service in the area, and $20 less than the price for Charter's 500 Mbit/s broadband tier. All three of those uncapped broadband tiers include a free DOCSIS modem.

(Source: Screen capture of Charter promotional pricing in Sedalia, Missouri, December 2023.)

Pricing on the 1-Gig promotion rises after a two-year period. Per a "multi-year manageable step-up plan," the price for 1-Gig eventually rises to $119.99 per month after about six years, according to a Charter official. Charter's typical price on 1-Gig broadband runs $89.99 per month (plus a free unlimited line of Spectrum Mobile).

Even with the future pricing step-up, the first two years of the promotion make 1-Gig speeds attractive when compared to Charter's other tiers while giving Charter a high-level tier to wield against area broadband competition.

Nudging subs toward gigabit speeds

It's also an indicator that Charter could be looking to steer new customers toward 1-Gig speeds. That fits with a broader trend. According to OpenVault's Q3 2023 Broadband Insights Report, about 32.1% of broadband customers tied into the study were provisioned for speeds of 1 Gbit/s or more, up slightly from 31.6% in the prior quarter. The percentage of broadband subs provisioned for 1-Gig-plus speeds only trailed the 35% of them provisioned for speeds of 200 Mbit/s to 400 Mbit/s, as tracked by OpenVault.

Charter's promotion surfaces as it and other cable operators are struggling to grow broadband subscribers in the face of more competition from fiber and fixed wireless access (FWA) options, record low churn rates and a sluggish housing move environment.

Helped in part by a rural buildout strategy, Charter added 57,000 residential broadband subs in Q3 2023, extending its total to 28.6 million. Speaking at an investor conference earlier this month, Charter CFO Jessica Fischer warned that the operator might lose net broadband subscribers in Q4.