What a difference a few million customers thrown your way makes.
Jon Fortt of CNBC opened the “Great Expectations: A Macro View of Consumers, Content and Communications” panel with a lunging question for Charter Communications CED Tom Rutledge. Charter had said Comcast’s purchase of Time Warner Cable was bad for consumers, he noted: “What changed your mind?”
“I do think it’s a great deal,” Rutledge said, eliciting a titter from the audience. “It’s a smaller deal from Comcast’s perspective,” Rutledge said, whose company will swap a few systems with Comcast and pick up a few million of the subscribers that Comcast intends to divest.
Both companies will be better able to compete based on how they’re distributed around the country, Rutledge said.
Fortt noted that Sen. Al Franken has been opposed to the transaction because it would likely be bad for consumers.
Roberts put a numbers spin on the deal. Comcast would be increasing by 7 million net, he said (making a total of approximately 30 million). Facebook has 1.2 billion users, Netflix has 35 million. “This gives the industry a better opportunity to have a footprint nationally. Go out to the show, we think X1 is a game-changer. Take the brains of that experiences out of box, put it in the cloud, and now click a button on your remote control, and as fast as communicating with a box go to Denver and back in same amount of time – that will give consumers better features, better services, and there’s no question there are more consumer benefits with these larger clusters.”
Fortt moved to the subject of boxes. Roku won’t work on Comcast, but it does on TWC, and who knows what will happen after the merger. “Does that matter to you?” he asked Matt Blank, Chairman & CEO, Showtime Networks.
Blank glanced at Roberts, then at Rutledge, and quipped “I’d first like to say how nice it is to be here with the entire cable industry…”
Answering Fortt’s question, he said, “It’s a dialog we have with all of our customers. We try to focus on brand, what we deliver to consumers, and using the technology. There will be more distribution options in the future, and we want to get people the content they want.”
Bob Stanzione, Chairman & CEO, Arris, said that proliferation of boxes was both threat and opportunity. “To my business? We view them as additive to our business. We supply both the CMTS as a platform for those devices to exist. Often plug into a box the operator provides. No reason the functions of those boxes couldn’t be incorporated. It’s a matter of business arrangements.”
Roberts asked Stanzione directly what to expect from vendors. Stanzione noted that Arris will be investing over a half billion dollars in R&D this year, to develop the technology necessary to support data rates up to 1 Gbps with GigaSphere (nee DOCSIS 3.1). “The chip vendors are investing a lot. Sometime toward the end of 2015, that equipment will be available, and you’ll be able to offer those services.”
Wi-Fi the panelists agreed, is becoming increasingly important.
Fortt asked Roberts if Comcast needs to own a wireless network in 5 years?
Roberts responded that cable does need a wireless play, and it has one in Wi-Fi, but it’s not clear how that might play out. “It’s like going into telephony,” Roberts said. “Some of went in to circuit switch, some waited for VoIP… it’s already true that a majority of data on smartphones is consumed in the home on Wi-Fi. We’re already the biggest wireless competitor.”
