Despite relaunching its pay television packages with an emphasis on choice and cost, Charter Communications this week reported a continuation of higher subscriber disconnects from its Spectrum TV business.
On Friday, Charter said the number of customers who “cut the cord” on Spectrum TV was around 1.23 million during 2024, including 123,000 who dropped their pay TV packages during the fourth quarter (Q4) of the year.
Charter ended 2024 with 12.89 million pay TV customers, including 12.33 million residential customers and 565,000 small business TV subscribers.
Charter was one of the earliest pay TV providers to negotiate distribution deals with major broadcasters and entertainment companies for access to streaming platforms like Disney Plus, Hulu, ESPN Plus, Peacock and Paramount Plus — all of which are now included across most Spectrum TV packages, without additional costs to subscribers.
Those offerings have yet to move the need for Charter, which has logged subscriber declines each quarter since its initial streaming-inclusive deal was first announced in late 2023, and well before then, too.
While Charter has marketed its streaming-inclusive options for cable TV customers, the message hasn’t resonated with subscribers, with some analysts saying the uptake of free streaming offerings has been relatively low.
To combat this, Charter intends to launch various outreach campaigns in 2025 that educate customers on streaming benefits that are baked into their pay TV packages. That will include a dedicated web portal that informs subscribers about the precise streaming services they receive in their pay TV package, with steps on how customers can activate and manage them.
“We look forward to fully rolling that out in the first half of this year and delivering even more value to consumers,” Chris Winfrey, the CEO of Charter, said on a conference call on Friday. Winfrey noted that Spectrum TV customers save around $80 per month by having access to ad-supported streaming platforms as part of their pay TV plan, compared to what it would cost them to purchase those same streaming services on an individual basis.
Charter also intends to market those savings to their Spectrum Internet customers, by pointing to a lower cost for Spectrum TV and Internet when bundled together, compared to each individual retail price.
The company hopes that kind of promotion will help reduce ongoing churn in the broadband side of the business, which saw 171,000 residential disconnects and 6,000 small business disconnects in Q4. Charter ended the year with 30.08 million residential and small business broadband customers.
Like peer telecom provider Comcast, Charter has faced ongoing pressure from fixed wireless broadband offerings launched by Verizon, T-Mobile and AT&T over the years. Those offerings, which utilize each carrier’s 4G LTE and 5G networks, typically cost less than comparable offerings from Charter and Comcast, especially when bundled with wireless phone service.
Initially, Comcast and Charter marketed their broadband services as more reliable than fixed wireless Internet, which is subject to lower priority connections and network congestion. Lately, the companies have focused their marketing efforts on promoting the value of bundling broadband Internet with wireless phone offerings like Xfinity Mobile and Spectrum Mobile, which operate on Verizon’s network.
On Charter’s end, the promotion appears to be working. The company added 529,000 mobile lines during Q4 to end the year with 9.57 million residential wireless lines and 315,000 small business wireless lines. The number of lines does not necessarily equate to the number of customers who purchase Spectrum Mobile, because some customer accounts have multiple lines.
Jessica Fischer, the Chief Financial Officer at Charter, said Spectrum Mobile is the “fastest-growing mobile service in the United States and offers the fastest overall speeds.” In the past, the company backed its claim of offering the fastest speeds by saying mobile users are advantaged by Spectrum Internet when they connect their devices via Wi-Fi. In early January, the BBB National Programs’ National Advertising Division (NAD) urged Charter to modify certain advertised claims about its wireless service, to include more-conspicuous disclosures on the limitations of the high-speed wireless data available to Spectrum Mobile customers.
