Complete Story
02/05/2018
Charter CEO Talks Original Content Strategy, Possible Cable Deals
The cable giant, led by chairman, president and CEO Tom Rutledge, reports its quarterly financials and says it signed up 2,000 residential video customers, and 13,000 small and medium business subs.
Cable operator Charter Communications, in which John Malone's Liberty Broadband owns a big stake, on Friday reported higher fourth-quarter financials and said it gained video subscribers after losing them in the year-ago period.
Charter, the second biggest U.S. cable company behind Comcast, is led by chairman, president and CEO Tom Rutledge.
Asked on an earnings conference call about Charter’s interest in more acquisitions, Rutledge said: “We like the cable business. We think it’s a good business. We think we can do well on it. And if there were opportunities for acquisitions at the right price, we’d always be interested.”
He was also questioned about last year's content partnerships with AMC Networks and Viacom that will give Charter an exclusive window on original content.
"Our plan is to work with proven content companies to get economies that work for us in terms of a windowing of content and to use that content to create a brand halo around our product," Rutledge said Friday. Both deals are "slightly different in scope," but "they essentially create a window of opportunity for us to use content in a way that benefits our customers," he added. "It’s an opportunity for us to be associated for a period of time with original content."
Under the AMC deal, unveiled in April, AMC Studios will develop and co-produce "distinct, high-quality original programming" and "exclusive co-branded content" for Charter's Spectrum platform, with the first content set to premiere this year. Under the agreement, Charter will have an exclusive initial window in the U.S. to the co-produced content for use on its own platform, while AMC Studios will retain subsequent rights, including international distribution.
Viacom said in November that its Paramount Television and Charter would jointly produce programming, with Viacom distributing it internationally, as well as in additional domestic markets, including potentially on its own networks, after an exclusive premiere window on Charter.
Charter on Friday reported fourth-quarter earnings of $9.6 billion, compared with $454 million on a pro forma basis in the year-ago period. The increase was "primarily driven" by a non-cash tax benefit of $9.3 billion "from a reduction in the deferred tax liability" as a result of Congress' December enactment of the Tax Cuts and Jobs Act, which reduced the federal tax rate from 35 percent to 21 percent. Revenue rose 3.2 percent to $10.6 billion.
The cable firm added 2,000 residential video subscribers in the latest period, compared with a loss of 51,000 in the year-ago period, ending December with 16.5 million residential video subscribers. It added 13,000 video subs in its small and medium business operation, up from 12,000 in the year-ago period.
