Charter CEO Tom Rutledge says programmers didn't secure content when going DTC

Tom Rutledge
Tom Rutledge. (Charter Communications)

Charter CEO Tom Rutledge once again used his company’s earnings call to rail against password sharing as a contributing factor to the eroding video market.

Rutledge has said before that OTT products make it easy for consumers to get television without paying but on today’s call, he specifically called out programmers for not securing their content.

“By the content companies going over the top without having the experience of being distributors, they’ve done that in a way without securing their content, which any distributor would theoretically do if they knew what they were doing. But that hasn’t been the case, so you have free service all over the country through passwords,” Rutledge said. “The reality is television can be had fairly easy without paying for it.”

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On top of that argument, Rutledge said that charging broadcast retransmission fees for free over-the-air content eventually drives people to get antennas.

Aside from password sharing, Rutledge said that the high cost of content and how it's bundled together wholesale by programming is continuing to put pressure on the entire video industry.

“I don’t see those trends changing. That doesn’t mean we can’t be successful in that marketplace,” Rutledge said.

RELATED: Charter loses 66,000 video subscribers but grows video revenue in Q3

Rutledge’s comments arrive against the backdrop of more video subscriber losses for Charter. The company lost another 66,000 subscribers this quarter but still managed to increase video revenue.

Rutledge said that growth is coming from Charter selling more expanded cable packages and part of the company’s strategy to push “feature-rich, high-value video products.”

“When we create a customer, we believe it’s appropriate to give the customer the full capabilities of our service,” Rutledge said, adding that Charter doesn’t generally sell basic cable and is therefore shrinking its broadcast-only base.

“If you’re a programmer receiving funds from us, we’re growing in your eyes because we’re growing expanded basic,” Rutledge said.

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