Author Topic: CHTR - Charter Communications  (Read 138172 times)

HalfMeasure

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Re: CHTR - Charter Communications
« Reply #530 on: July 08, 2018, 06:23:40 PM »
Anyone have a good resource for broadband market share on a regional level?


vince

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Re: CHTR - Charter Communications
« Reply #531 on: July 08, 2018, 10:35:16 PM »
https://www.livewiremarkets.com/wires/charter-communications-digging-a-moat-to-lay-cable

Interesting article, but it completely ignores the 5G issue.  The more I research the more I think 5G will be a strength rather than a threat to Charter.  Even Verizon says that only 25% of the current broadband customer base will be cost effective to convert to fixed wireless.  I'm guessing that number is slightly optimistic, probably more like 20%.  It will be less costly for Charter to build out fixed wireless, if it wants to, than Verizon, AT&T, or any other wireless carrier.
Hi JRM, could you please show me where Verizon says that or where you saw it?

What tipped me off to that number was a post on a VIC article.  The post was almost more informative than the actual article.  What was actually said was "30 million customers" which supposedly correlates to ~25% of the market.  I don't have a good way to double check the denominator in this estimate.  Here's another source: https://www.fiercewireless.com/wireless/editor-s-corner-1-gbps-speeds-verizon-s-5g-residential-fixed-wireless-broadband-service
Thanks JRM, was the VIC article a response to a Chtr writeup?

JRM

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Re: CHTR - Charter Communications
« Reply #532 on: July 09, 2018, 03:52:25 AM »

vince

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Re: CHTR - Charter Communications
« Reply #533 on: July 09, 2018, 06:06:29 AM »
thx again

vince

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Re: CHTR - Charter Communications
« Reply #534 on: July 10, 2018, 05:34:12 PM »
Craig Eder Moffett - MoffettNathanson LLC - Founding Partner
Well, let's -- since we're more focused on broadband now, I'm going to change the subject away from broadband and go to video for a second. I
guess -- so obviously, OTT and cord cutting are the big stories that people are focused on, and that's going to continue to pressure subscribers. I
guess, the thing that would be most helpful for your investors is if you can just take us through the economics of what it's like to lose a subscriber.
How -- in essence, how important is it that you have high video numbers? Or are video subscribers less important than a lot of people crack them
up to be?
David N. Watson - Comcast Corporation - Senior EVP & President, CEO, Comcast Cable
Let me start, to make it very clear, we still think video is a very important category. We're still going to compete. We have a great product in X1. I
think one of the things we've learned through this OTT period is that a great product like X1 with good value between excellent DVR service, every
one of our X1 customers has Stream connected to it, so you can do TV everywhere elegantly. Applications can come together, like Netflix and
YouTube and others. So by -- we're going to compete with video. But to the extent that you lose a video customer, we've also taken the time to
look at the marginal economics, to your point, of what happens when you lose that video relationship. And there are a couple of things that jump
out in the way we're managing the business. One is that we -- that customers always get the best deal through packaging. To the extent that video
that they either downgrade, they don't have video, that multi-product discount, regardless of video, goes away. So broadband pricing will go up.
Second thing is there's less programming cost. And the third thing is that it's -- there's generally more noise attached to servicing the video customer,
more CPE, more activity. And it's just the more efficient relationship to manage in regards to broadband, so your cost to serve is improved. So you
take all of those things, this is a very manageable transition in terms of net cash flow. And you look at...
Craig Eder Moffett - MoffettNathanson LLC - Founding Partner
Do you want to go out on a limb and put a number on what a customer -- what a video customer -- what you really lose when a video customer
unbundles the video?
David N. Watson - Comcast Corporation - Senior EVP & President, CEO, Comcast Cable
Well, I won't go way out there, but I will say this that we segment the marketplace. And a good part -- we've been doing this for a while, but we
look at the -- all the video relationships, and some are fantastic and a lot of them are, most. We feel great about, full video, package -- skinnier
packaging with broadband. There's a lot of opportunities still. But we've seen some low-end customers that have dropped video, maintained
broadband, and those low-end customers, you actually -- it's accretive when that happens. And so the trick now is to make sure you're very focused
and you're doing a really good job segmenting the marketplace, so you understand that in the first place. So I think it's a manageable transition,
very focused on this. Again, we think the connectivity business has a long runway, and so that's why we shifted our focus.

scorpioncapital

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Re: CHTR - Charter Communications
« Reply #535 on: July 14, 2018, 11:51:24 PM »
I have a friend who went to internet TV. He even gets a lag, he's on a slow connection and doesn't care too much. I think pay TV is definitely going to drop faster than people
think.

What do people think on charter debt load? It's high and some have said tangible equity is negative. In fact charter even went bankrupt in 2009. Are debt risks being underestimated or is this a different situation, likely higher cash flows, better rates , and possible inflationary future ?

Spekulatius

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Re: CHTR - Charter Communications
« Reply #536 on: July 15, 2018, 05:47:45 AM »
I have a friend who went to internet TV. He even gets a lag, he's on a slow connection and doesn't care too much. I think pay TV is definitely going to drop faster than people
think.

What do people think on charter debt load? It's high and some have said tangible equity is negative. In fact charter even went bankrupt in 2009. Are debt risks being underestimated or is this a different situation, likely higher cash flows, better rates , and possible inflationary future ?

When CHTR went bankrupt (I think it was a Paul Allen vehicle then), it was badly run from an operational POV, subscale and the debt load was much higher in terms of EBITDA/EV. CHTR debt right now is 4-4.5x. EV/EBITDA which is in the same ballpark than most utility companies and since the business is comparable (if not better), I feel it is manageable. CHTR tangible equity is in fact negative, yahoo shows it as such and should be about correct.
To be a realist, one has to believe in miracles.

Deepdive

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Re: CHTR - Charter Communications
« Reply #537 on: July 15, 2018, 07:17:41 AM »
I hope others here can help me understand the risk in CHTR

1) Cord cutting - many have pointed out that video doesn't have much margin and broadband has very high margin.  If cord cutting accelerates, how does CHTR content cost scales down?  How does CHTR support staff scales down?  It is terrible to work at a company that is constantly scaling down.  How does CHTR retain the employees in a scale down?  How are CHTR's contracts structured for content cost?  Is it 100% variable?  Is there a fixed component? 

2) 5G risk - Many have mentioned that the Telco would be wiser to buy CHTR.   Can someone explain the overall physics?  I have heard leaves, rain etc hurting milimeter waves performance.  Is there a certain density like NYC where it makes sense to deploy?  Can the Telcos selectively deploy in NYC, Chicago, LA etc?  There is also talk that only sub 3GHZ will be used.  Any thoughts? 

3) Emerging 5G risk - Low orbit satellite? Li Lu is supposedly backing someone for a 5G venture?  What are the rumoured disrupted technology?

4) Risk of 100% fiber to the house vs the current Fiber to the node and then co-axial to the house

5) Debt covenants - Anyone looked at them? 

What are we missing? 

HalfMeasure

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Re: CHTR - Charter Communications
« Reply #538 on: July 15, 2018, 09:21:05 AM »
I hope others here can help me understand the risk in CHTR

1) Cord cutting - many have pointed out that video doesn't have much margin and broadband has very high margin.  If cord cutting accelerates, how does CHTR content cost scales down?  How does CHTR support staff scales down?  It is terrible to work at a company that is constantly scaling down.  How does CHTR retain the employees in a scale down?  How are CHTR's contracts structured for content cost?  Is it 100% variable?  Is there a fixed component? 

2) 5G risk - Many have mentioned that the Telco would be wiser to buy CHTR.   Can someone explain the overall physics?  I have heard leaves, rain etc hurting milimeter waves performance.  Is there a certain density like NYC where it makes sense to deploy?  Can the Telcos selectively deploy in NYC, Chicago, LA etc?  There is also talk that only sub 3GHZ will be used.  Any thoughts? 

3) Emerging 5G risk - Low orbit satellite? Li Lu is supposedly backing someone for a 5G venture?  What are the rumoured disrupted technology?

4) Risk of 100% fiber to the house vs the current Fiber to the node and then co-axial to the house

5) Debt covenants - Anyone looked at them? 

What are we missing?

This might be helpful on #2 - Nokia on fixed-mobile convergence https://onestore.nokia.com/asset/201230

HalfMeasure

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Re: CHTR - Charter Communications
« Reply #539 on: July 23, 2018, 10:12:44 AM »
Does anyone here have a sense for how the marginal unit economics of upgrade a household to all digital and doing a DOCSIS 3.1 upgrade, or has anyone come across resources useful in doing that math?