Taking aim at opportunities with retail chains, fast food companies and other large, enterprise-level business customers, Charter Communications has introduced a new high-speed Internet product that can be offered outside its 41-state network footprint.

That new offering is called Spectrum Total Connect. It's aimed at large, national businesses served by Spectrum Business National Accounts, a unit focused on providing services to regional and national franchises, large retailers and organizations that have a significant base of employees that work from home.

The initial offer provides several speed tiers up to 940 Mbit/s bundled with several features, including a suite of security products and up to 25 custom email accounts. Whether connectivity is provided by Charter or a partner, the customer pays with one bill, the cable op said.

Charter is actively taking orders on the new product as it starts to be rolled out in the coming weeks. Charter is enabling Spectrum Total Connect through access via its own networks and those from partners with which Charter has network agreements but declined to name them.

This follows a trend for some of the nation's largest MSOs. Comcast, for instance, embarked on a national business service offering targeting Fortune 1000s in 2015, thanks in part to network partnerships with several US cable operators, including Charter, Cox Communications and what is now Altice USA. Last year, Comcast Business expanded into Canada via a partnership with iTel Networks, a company with wholesale agreements with carriers such as Shaw Communications, Rogers Communications, Telus and several dozen smaller cable operators and telcos in Canada.

Why this matters
The out-of-footprint capability gives Charter an avenue to land connectivity deals with larger, enterprise-level customers that require connectivity in multiple markets rather than limiting deals to what can be delivered via Charter's wireline footprint. The new offering also arrives about four months after Charter sold its Navisite managed cloud services unit to RDX as part of a plan to streamline its business services portfolio and move ahead on a strategy focused on providing "scalable fiber-based technology solutions."

Though large business services deals typically carry long sales cycles, the new capability could help Charter pursue the kind of deals that would typically go to telco competitors such as Verizon or AT&T.

If this line of service is successful, it could help to build on Charter's business services segment, which has been largely tilted toward small and midsized businesses. That segment of Charter's business pulled down $1.61 billion in Q3 2019 ($974 million among SMBs and $644 million from the enterprise segment) versus $1.55 billion ($922 million for SMBs; $632 million for enterprise) in the year-ago period.

Serving small and midsized businesses have been US cable's bread and butter from a commercial services standpoint for years, but expanding into the field of larger enterprise-level customers is expected to play a more significant role in cable's growth story in the years to come.

Per recent numbers from Alan Breznick, Light Reading's Cable/Video Practice Leader, US cable is expected to see business services revenues grow between 5% to 6% in 2020. The rate of growth in this area, still in the double-digits a couple of years ago, has slowed as the cable industry's business services efforts have scaled up particularly around small and midsized commercial customers. Moves further up-market could help to move the revenue needle from a smaller population of enterprise-level customers.

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— Jeff Baumgartner, Senior Editor, Light Reading