Charter has for the last several years touted the magic of its Spectrum Guide, a cloud-based, two-way interactive video interface designed to deliver a constantly evolving, state-of-the-art user experience, comparable to Comcast’s X1 in quality but not in lofty price.
Unfortunately, the vast complexity of Charter’s integrations of Time Warner Cable and Bright House Network are obscuring the performance metrics of the cloud-based UX. Because of all the integration chaos, we don’t know if Spectrum Guide can be the magic bullet that turns the tide on churn, much as X1 has at Comcast.
Charter has lost 267,000 video customers in the first four full quarters since closing on its two big cable purchases, most of which have come from TWC subscribers on steep promotions not transitioning to Charter’s “Spectrum” branding, packaging and pricing.
In fact, Charter lost 105,000 former TWC customers in the fourth quarter of 2016, offsetting gains by legacy Charter and Bright House. Charter lost another 108,000 TWC pay-TV homes in the first quarter and yet another 68,000 in the just-reported second quarter.
During the first quarter earning call, Charter Chairman and CEO Tom Rutledge referred to Spectrum Guide when he noted, “None of [the OTT competitors] have a product that’s better than ours in the marketplace.”
“Given all the integration activity, Charter legacy would have been positive if we hadn’t been doing that,” he added. “The [video customer loss at legacy Charter] is an effect of our integration process more than anything else.