Author Topic: CHTR - Charter Communications  (Read 174231 times)

vince

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Re: CHTR - Charter Communications
« Reply #650 on: September 15, 2018, 06:20:47 PM »
Cam, I dont know how much we actually need and what kind of bandwidth new applications will consume but you should take a look at what kind of speeds, amount of devices connected per home, and monthly household usage (in gigs) is happening.  Its growing exponentially with no signs of slowing and lots of executives close to the data believe that it has barely started.


cameronfen

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Re: CHTR - Charter Communications
« Reply #651 on: September 15, 2018, 06:41:07 PM »
Cam, I dont know how much we actually need and what kind of bandwidth new applications will consume but you should take a look at what kind of speeds, amount of devices connected per home, and monthly household usage (in gigs) is happening.  Its growing exponentially with no signs of slowing and lots of executives close to the data believe that it has barely started.

There is a difference between data usage and how much bandwidth you need.  Most of the new data you use, like IoT will have a limited effect on bandwidth consumption.  That is because they are continuously downloading/uploading small amounts of data, which causes the amount of data to be large, but will cause no discernable effect on speeds.  For example, you can with 1Gbps, if you are using it continuously at its max level, a household can download 324 terabytes of data a month.  That kind of data is enough to watch 462,000 hours a video a month (or 600+ hours of video every hour).  We won't get close to that much data usage for a long time, and no family hardly uses even a 100GB of data a month much less a terabyte.  This just gives you an idea of how much bandwidth every household actually has, but also my point is it doesn't really matter if you have IoT machines that continuously are uploading small amounts of data (you will never run out of data in that way), what really matters is how much data you use at your peak usage.  And at this point, we are running into diminishing returns of using more bandwidth per second as video quality is basically already as good as possible and there are limited other avenues to increase data per second (maybe AR or massive machine learning requiring video). 
« Last Edit: September 15, 2018, 06:47:21 PM by cameronfen »

vince

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Re: CHTR - Charter Communications
« Reply #652 on: September 16, 2018, 01:01:10 PM »
I am not necessarily disagreeing with you and will just put up a quote from Brian Roberts on 2nd qtr call that supports what I was pointing out.  "The increasing importance and value of broadband to our customers is clear. Our customers' median monthly data usage on our network now exceeds 150 gigabytes for the first time. Additionally, our xFi customers are connecting an average of 11 devices in the home over Wi-Fi daily".  This quote doesn't really prove anything but it does show that mgmt feels pressure to continue to improve the network.  Roberts in other parts of call and other cable Ceo's consistently stress how the consumer values and is demanding higher speeds and is willing to pay for it as well.  Cabo mgmt is doing market elasticity tests this year and the early results are remarkable.  Consumers want, need and are paying for higher speeds without negative effects on churn.  Chtr's mgmt claims that increasing the abilities of the network, from here, is a strong and durable advantage and that results up to now show very clear improvements in customer metrics whenever they take speeds up.  I guess my point is that customer behavior right now is not consistent with what you are printing.  I am not saying that your numbers are wrong and maybe demand will level off soon but every indication is that this is an amazing business and has a very long runway with incredible pricing power. 

Liberty

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Re: CHTR - Charter Communications
« Reply #653 on: September 16, 2018, 04:54:20 PM »
Bill Gates might not actually have said it, but the idea of "640K ought to be enough for anybody" repeats itself every few years.

It's a chicken and egg thing; once people have huge bandwidth/a new capability, new services tend to be created that use that bandwidth/capability and that couldn't have existed before.

I think there's currently a bunch of headroom in bandwidth for most people, but who knows where we'll be on that pendulum swing in a few years? And have people ever been rational about getting only what they need? How many people buy SUVs because "maybe someday I'll want to go off road or tow something" and they basically never do?
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cameronfen

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Re: CHTR - Charter Communications
« Reply #654 on: September 16, 2018, 05:34:49 PM »
I guess I'll admit that I didn't expect the median data usage to be 150GB per household, but the argument regarding if you build it they will come is bunk.  We can download full length movies in a about a minute.  Video games with real world graphics and landmass the size of a small city can be downloaded in 30 mins.  If people will build bigger programs when we have bigger pipes why haven't they.  I remember when world of warcraft was like a 5Gb game when it first came out and it took like all night to download.  Now if a game takes all night to download it has to approach 500 GB.  Games just arent keeping pace with the biggest ones just under 100 GB. 

The idea that we just need extra bandwidth before someone innovates is a straw man imo.  We already have excess bandwidth and yet no one is building super VR systems which will tax all your bandwidth. 

My guess is cable cos are seeing people switch to faster internet because most people dont understand that faster speeds will effect them in marginal ways.  (I have no proof to back this up though).  Cable is basically a monopoly and so they have no incentive to educate people and just offer multiple tiers for the suckers who like having larger numbers than their peers.  But when you have competition, the first thing they will go after is there is no difference in UX.  Why did google fiber fail?  I think it was likely because other than the expense, having significantly faster internet didn't interest people when you have another party who is actively interested (and able to cut price further) in spreading this information. 

Edit:  I realize this post may come off as sounding defensive.  It's not my intention, just trying to provide a variant view (that I believe lol). 
« Last Edit: September 16, 2018, 05:39:32 PM by cameronfen »

vince

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Re: CHTR - Charter Communications
« Reply #655 on: September 16, 2018, 06:02:51 PM »
I dont really want to speculate why demand is growing faster than need (if in fact that is the case), but we are definitely on opposite sides on this one.  You think competition might cause speeds to flatline because consumers will focus more on price (I think thats what u meant) and realize they dont need more than 100 mb.  I think competition up to 100-150 (or potential competition) is what caused cable to up their speeds cause they knew from recent experience (and also from European market behavior) that consumers would value it and were confident they would get paid for it.  But what I have come to appreciate more recently, after thinking this thru over and over, is that cable can give 1 gig to everyone in their footprint, almost for free, at very low incremental cost.  And like I said, I am not really sure about the scientific numbers and you (Cam) bring up some good points but I will almost guarantee that if cable feels like they want to or have to give 1 gig and 300-500 is their best competition, their market share will increase from today's levels.  Cable execs wont say it but I have come to believe this is a major factor in their confidence. 

jmp8822

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Re: CHTR - Charter Communications
« Reply #656 on: September 16, 2018, 06:13:32 PM »
I dont really want to speculate why demand is growing faster than need (if in fact that is the case), but we are definitely on opposite sides on this one.  You think competition might cause speeds to flatline because consumers will focus more on price (I think thats what u meant) and realize they dont need more than 100 mb.  I think competition up to 100-150 (or potential competition) is what caused cable to up their speeds cause they knew from recent experience (and also from European market behavior) that consumers would value it and were confident they would get paid for it.  But what I have come to appreciate more recently, after thinking this thru over and over, is that cable can give 1 gig to everyone in their footprint, almost for free, at very low incremental cost.  And like I said, I am not really sure about the scientific numbers and you (Cam) bring up some good points but I will almost guarantee that if cable feels like they want to or have to give 1 gig and 300-500 is their best competition, their market share will increase from today's levels.  Cable execs wont say it but I have come to believe this is a major factor in their confidence.

I get what you're saying here with speeds being very low cost to upgrade, but doesn't the concept of having 'unlimited' seamless 300mb speed at your house and in most major cities (unknown how long this might take) for a similar price point trump having 1 gig?  Plus the concept of not needing a cable guy at my house ever again is appealing. I think the network effect of mobile carriers could tip the scales because no one is cancelling mobile service anytime soon, whereas fixed cable internet? Maybe. It seems if there is one that will be disrupted it is more likely cable internet, instead of a nationwide mobile/broadband company with strong network effects.

Spekulatius

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Re: CHTR - Charter Communications
« Reply #657 on: September 16, 2018, 06:22:52 PM »
Quote
I get what you're saying here with speeds being very low cost to upgrade, but doesn't the concept of having 'unlimited' seamless 300mb speed at your house and in most major cities (unknown how long this might take) for a similar price point trump having 1 gig?

It might, if it is reliable and the ping is good, Generally speaking, the ping on phones sucks and the speed vary a lot. In one spot you may be Ok, but you move a few meter and may have a very unsatisfactory connection. For the 5G to replace a good internet connection, the coverage and ping needs to be very good.
To be a realist, one has to believe in miracles.

cameronfen

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Re: CHTR - Charter Communications
« Reply #658 on: September 16, 2018, 06:23:52 PM »
I dont really want to speculate why demand is growing faster than need (if in fact that is the case), but we are definitely on opposite sides on this one.  You think competition might cause speeds to flatline because consumers will focus more on price (I think thats what u meant) and realize they dont need more than 100 mb.  I think competition up to 100-150 (or potential competition) is what caused cable to up their speeds cause they knew from recent experience (and also from European market behavior) that consumers would value it and were confident they would get paid for it.  But what I have come to appreciate more recently, after thinking this thru over and over, is that cable can give 1 gig to everyone in their footprint, almost for free, at very low incremental cost.  And like I said, I am not really sure about the scientific numbers and you (Cam) bring up some good points but I will almost guarantee that if cable feels like they want to or have to give 1 gig and 300-500 is their best competition, their market share will increase from today's levels.  Cable execs wont say it but I have come to believe this is a major factor in their confidence.

Yeah your points are generally the weak points of my thesis I do concede.  For some reason cable with higher bandwidth consistently takes share from DSL providers in Europe, which I really do not have a counterpoint for, however, we are comparing 100 mbps to between 1 and 10gbps, when in Europe the average speed is like 15-25 mbps.  I guess that is my retort.  That being said from a personal point of view I side with jmp on what type of cable package I view as the best value to me, and I think many other consumers if properly educated will see it this way too. 

vince

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Re: CHTR - Charter Communications
« Reply #659 on: September 16, 2018, 06:46:54 PM »
JMP, I am posting a quote by Rutledge recently that helps answer ur question about how long it takes Verizon to bring that network.   "Now they've said they're going to do 30 million homes passed over a 10-year period, at 10 years will be 140 million homes in the country so that will be about 20% of the country, and we'll represent 8% of that. So over a 10-year period, they're planning to overbuild 8% of our footprint. And we can, to the extent that any of that's a me-too product, we'll have a more competitive environment there and we'll have to deal with it. But we'll be moving our network along during that 10-year period."  In addition, Charter just rolled out a product to compete with Verizon and it is across 100 percent of their footprint nationally (chtrs footprint).  At least with that info it looks like chtr is better positioned although admittedly they have to pay Verizon for that mvno. By the time there is enough coverage to compete with chtr, 300 will not be enough