Should the mergers close, the rebranding of Time Warner Cable (NYSE: TWC) and Bright House Networks assets into the Spectrum portfolio will go smoother than they did for Charter Communications (NASDAQ: CHTR) itself, according to Charter President and CEO Tom Rutledge.
TWC's "plant infrastructure is in a better place, and Bright House has better customer service," Rutledge said, speaking Tuesday at the Morgan Stanley Technology, Media and Telecom Conference.
Charter spent most of 2014 "walking through several hundred thousand miles" of its own cable systems, upgrading them to two-way digital functionality and readying them for the cloud-based Spectrum Guide delivery system.
"We found many things to fix," Rutledge said, noting the high capital investment the broad-reaching upgrade required. Noting concurrent investments into customer service, Rutledge said the investment paid off last year, with Charter reporting its first video customer growth since before the Great Recession.
"It was a long process of losing customers to satellite [and telco competitors], but we built a sophisticated, two-way infrastructure as a competitive response," Rutledge said. "But going forward, I think we can rebrand [TWC and Bright House] with Spectrum sooner."
Speaking to an audience of mainly investment analysts, Rutledge was also asked about his opinion on the FCC's new set-top mandate.
"I like everything the FCC does," he quipped, a nod to the fact that his MSO's bids to acquire TWC and Bright House remains in the regulators hands.
Walking a thin line, Rutledge said he understands that pay-TV operators "charging excessively for set-top boxes creates political pressures that are real."
He then attempted to make the issue someone else's concern.
"If I were content company, I would be extremely worried about it," he said. "At its core, [the FCC's proposal] separates content from ownership."
Also asked if he thinks the wireless industry's evolution into 5G will pose a competitive threat to the wireline-based broadband services offered by cable companies, Rutledge answered in the affirmative.
"Wireless companies are building infrastructure capable of replacing the wireline world," he said. "You will have substitution. I look at the wireless companies as competitors, but I think we can all do well in the marketplace."
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