Charter Communications will begin marketing its video, telephone and broadband service under the Charter Spectrum brand early next year.
Charter would follow several other cable operators that have rebranded their video and broadband products, including Comcast XFinity and Cablevision Systems’ Optimum. Charter, with the lowest video penetration of any publicly traded cable operator at about 34% of homes passed, has made several moves in the past year to repackage and reprice offerings to make them more attractive to consumers. The rebranding appears to be the logical next step.
Charter senior vice president of communications Alex Dudley said that with all the transformative changes to Charter’s products as the company goes all digital – more than doubling HD channels from about 100 to more than 200; significant increases in broadband speeds; and the introduction of a cloud-based user interface – it seemed like the proper time to unveil a new brand.
Charter CEO Tom Rutledge hinted that a rebranding was on the way during the MSO’s third quarter conference call on Nov. 5. During that call he said that Charter’s video service has been challenged because it was inferior to the competition. Rutledge’s initiative to upgrade Charter’s plant to all-digital by the end of 2014 has doubled HD offerings and increased broadband speeds, which should translate into new subscribers.
On the earnings conference call, Rutledge said he was surprised how despite the changes, Charter is still growing broadband-only customers at a robust clip – it ended the quarter with 1.3 million residential non-video customers, up 26% from 1.04 million in the same period last year. Non-video customers now make up about 24% of Charter’s total customer base.
Rutledge attributed that lift in part to changes in the way customers consume entertainment.
“But the bigger part of it is that Charter’s video product was inferior, and we had brand issues around that,” Rutledge said on the call.
Charter has made moves to improve the brand — he said customer perception of Charter has risen from worst in the industry to above average — but there is more to be done.
“I think we need to be more than above average,” he added on the call. “Our new customers have very high opinions of their service levels with us. So the time has come, I think, for us to begin to rebrand Charter and to go forward with a more aggressive push into the marketplace with our video product and our triple-play.”
Charter expects to begin rolling out Charter Spectrum in the first quarter of 2014 and will expand as markets are converted to all-digital. While Charter did not reveal which markets will be targeted initially for the rebranding, its Fort Worth, Texas market is one of the first to go all-digital and will likely be an early candidate for the rebranding efforts.
Dudley added that the Spectrum name came about as a result of internal discussions led by chief marketing officer John Hargis and advertising and marketing agencies Charter uses in the normal course of business. He added there are no plans to put the Charter Spectrum logo on trucks or employee uniforms in the immediate term, but that could change as the rollout moves forward.
