As it rolls out its rebranded Spectrum service in the old Time Warner Cable and Bright House footprints, Charter Communications is facing widespread backlash over pricing.
It's an age-old phenomenon for communities to gripe about cable pricing, but in the current atmosphere of rebundling and cord-shaving, the response to Spectrum's presence is well worth noting.
In the year since Charter's takeover of TWC got the OK from federal regulators, the company has revised its strategy. CEO Tom Rutledge derisively compared the previous approach on price to a "Turkish bazaar," given the opportunity for customers to call and haggle over rates. His new vision is fixed rates, which would of course enable Charter to deliver more consistent and predictable results to Wall Street (something important to Rutledge, who after all was America's highest-paid CEO in 2016).
The hitch in this plan, as documented by TV Answer Man, aka Philip Swann, is that local newspaper accounts across the Spectrum footprint are replete with blowback.
One issue across several markets is the decision to move some popular channels to pricier tiers. The Orlando Sentinel has run three articles in the past month in which subscribers voice their dissatisfaction the company. Even those who say they remain largely satisfied say they are taking note of the changes. “Overall, I’m happy with the service,” Cindy Sims told the paper April 24. “But they are raising prices and doing nothing different.”
On May 22, the Syracuse Post-Standard carried a story whose headline said it all: "Price-shocked Spectrum cable customers react, ready to cut cord: 'I'm really upset'."
Two days later, the Lexington Herald Leader reported on city officials being "frustrated by complaints of shoddy customer service and the recent layoffs of 56 employees." The paper said officials want Charter executives "to come to city hall to discuss the city’s mounting concerns about the cable company.”
While Rutledge visited the White House and got kudos from President Donald Trump about plans to add jobs, the decision to lay off about 200 workers and close a Time Warner Cable call center didn't sit well with the Palm Springs, California, Desert Sun, which documented the move.
In response to the issues, Charter's Rich Ruggiero noted that much of the complaints center on Bright House and TWC pricing packages that are now expiring. "Spectrum packages almost always represent a much better value when compared with those legacy retail prices, along with much lower equipment costs and no modem fee at all, for example," he wrote. He added that, while Charter has closed some call centers, it has also hired new employees elsewhere.
In the first quarter, Charter posted a net loss of 100,000 video customers. Those numbers largely reflect the deployment of Charter's new pricing; the company's Spectrum brand had launched in every former TWC and BHN system except Hawaii by the end of the first quarter.
Article updated May 31 with commentary from Charter.