Charter Communications has announced native deployment of HBO Max and YouTube on its cloud-based video operating system, Spectrum Guide. 

The two services join Netflix as the only apps available on Charter's Spectrum Guide platform. Charter said that the two added video platforms would work on "eligible devices." 

Like Netflix, which was deployed on Spectrum Guide back in 2018, HBO Max will only be available on newer model Worldbox 2.0 set-tops, which a Charter rep told us, "make up a majority of our deployed Worldboxes."

The YouTube app will play on all Worldbox set-tops. 

Notably, Spectrum Guide was developed a decade ago as a means of keeping older set-tops viable--the system relies on processing of video images and audio in the cloud. It appears that for streaming apps, however, a certain level of computer processing performacne is required in the client device. 

“As the video landscape continues to change, we are evolving our products and making it easier for our customers to watch what they want by providing access to streaming apps from convenient launch points within the Spectrum TV experience,” said Elena Ritchie, group VP of video experience for Charter. “We look forward to growing this library and expect to launch more streaming video apps in the coming months.”

Spectrum Guide customers with the right customer premises equipment can tune directly into channel 2003 for YouTube or 2004 for HBO Max, or they can click on the appropriate logos in the app menus. 

Charter is the second biggest pay TV operator in the U.S., with just over 16 million subscribers. It only trails Comcast, which natively integrated HBO Max into its Xfinity X1 and Xfinity Flex platforms last December. 

Perhaps the most surprising comment during an active week of first-quarter earnings reports came from Charter Communications Chairman and CEO Tom Rutledge, who revealed that his cable company has had discussions—seemingly recent—about licensing X1 from Comcast.

“We've had discussions with [Comcast] about licensing their X1 platform and their new IP video platform," Rutledge said during Charter’s Q1 earnings call, responding to the very last investment analyst question. "And if we can make that the best platform for us, we'd certainly be willing to do that, and we think they'd be a great provider."

Related: Charter’s Rutledge: 'We’ve Had Discussions' With Comcast About Licensing X1

Comcast, of course, licenses its X1 advanced video delivery platform to the No. 3 cable company in the U.S., Cox Communications, as well as all three major cable operators in Canada, Rogers Communications, Shaw Communications and Videotron.

But Charter is years and hundreds of millions of dollars down the line, developing and deploying its own Spectrum Guide cloud-based video system. This initiative not only includes the $135 million joint purchase of the key technology vendor for that platform’s UI, ActiveVideo, but also development of the WorldBox QAM/IP hybrid set-top platform, jointly cooked with Cisco.

So recent were these talks?

Rutledge’s mention of an “IP video platform” seems to be a reference to Comcast’s just announced Xfinity Flex service, which provides some indicator.

Speaking to numerous unnamed sources, Light Reading reported that members of Charter’s video team had visited Comcast’s home town of Philadelphia within the last several weeks.

Would Charter actually consider switching to X1 syndication?

According to Light Reading, these talks between Comcast and Charter have gone on for years.

It doesn’t appear as though X1 has a marked churn-reducing advantage over Spectrum Guide, with Comcast shedding 371,000 video customers in 2018 vs. Charter’s 244,000.

And Rutledge seemed to stop the speculation right where it started, noting, “We like having our own UI, and we like having the ability to change that UI at the pace we want to change it and have it reflect our marketing strategy.

“If we could check all the boxes in terms of flexibility and low cost, we could be a vendor of Comcast and their platform,” he added. “But to date, we haven’t been able to do that.”

Charter Communications continued to accelerate the rollout of its hybrid QAM/IP WorldBox platform as it also prepares to launch a mobile product that leans on its Verizon MVNO agreement by mid-2018.

Charter, which restarted its all-digital project last year, has deployed about 2 million WorldBox units so far, company chairman and CEO Tom Rutledge, said Friday on company’s Q4 2017 earnings call.

That about doubles the number of WorldBoxes that Charter had deployed at the end of the third quarter of 2017. In addition to supporting IP and QAM transport, Charter’s WorldBox also supports a cloud-based guide and a downloadable security platform that will enable it to work across Charter’s entire footprint, including systems obtained from the Time Warner Cable and Bright House Networks acquisitions.

RELATED: Charter Has Deployed 1 Million-Plus WorldBoxes

Following earlier work with vendors such as Cisco Systems and Humax, Charter has since tapped Arris for a WorldBox 2.0 project that is targeting devices that are cost-efficient than the predecessor WorldBox models.

Charter is also using cloud technology from ActiveVideo (now jointly owned by Charter and Arris) to bring its new Spectrum Guide to the WorldBox as well as older, non-IP boxes.

RELATED: Arris, Charter Close $135M ActiveVideo Acquisition

Rutledge said Charter expects to have Spectrum Guide available to virtually all its video customers by the end of 2018, including “mixed markets” like Los Angeles where legacy Charter systems are contiguous with legacy TWC systems. The expanded guide rollout will also expose those customers to Charter’s larger VOD library (about 50,000 HD titles).

Existing customers in those markets will, over time, have the choice to switch to the new Spectrum Guide using their remote control, Rutledge said.

He also reiterated a plan to integrate OTT services such as Netflix, viewing Spectrum Guide as a “"hub for accessing content that originates from us or from somewhere else." Those third-party apps will first be made available on the WorldBox and extend to older box types over time,” Rutledge said. Charter will also use ActiveVideo’s cloud technology to bring those apps to IP- and non-IP capable boxes.

Mobile Pricing Not Yet Set

Shifting to wireless, Charter’s goal with its new mobile product is to gain and retain more cable customers.  

“We haven’t decided how to price it,” Rutledge said. “But our long-run view on pricing is that we should offer a good value for high quality products and we should integrate that into our overall product packaging scenario." 

Perhaps an indication of what Charter is considering, Rutledge did heap some praise on Comcast’s rollout of Xfinity Mobile, which offers unlimited and by-the-Gig data options. “I think they did a really nice job with their pricing model,” he said.

RELATED: Xfinity Mobile Starting to See ‘Real Momentum’

Rutledge also expanded on Charter’s longer-term plan to use a mix of licensed and unlicensed spectrum.

Riffing on keynote comments he made last fall at the SCTE/ISBE Cable-Tec Expo in Denver, Rutledge again referred to it as “6G” – Charter’s tongue-in-cheek, pre-spec definition of the integration of small cell architecture using unlicensed and licensed spectrum working in tandem with its DOCSIS 3.1 rollout. 

“We expect that over time our existing infrastructure will put us in the unique position to economically deploy new, powerful products that benefit from small cell connectivity,” Rutledge said. "We may want to take additional licensed spectrum and combine with WiFi spectrum to create an even broader in-home, in-business and mobile platform." but he  stressed that there’s no plans currently to launch that in 2018 or 2019.

Rutledge also downplayed fixed 5G as a significant threat to cable’s broadband business, noting that those wireless networks will still need to be backed up with solid wired backhaul systems.

“I see all the same kind of costs necessary to build a 5G network as there is to build a wireline network, and maybe more,” he said.

As for DOCSIS 3.1, Charter plans to deploy that technology and enable 1 Gbps speeds (initially in the downstream) across its footprint and all 50 million passings by the end of 2018. Charter has deployed D3.1 to eight markets so far.

RELATED: Charter Rolls DOCSIS 3.1 to Seven More Markets

Charter has also started to make 200 Mbps its minimum speed in about 18% of its footprint, including systems in Hawaii, New York and Charlotte. Charter currently offers minimum speeds of at least 100 Mbps to 99% of its footprint, up from 50% in June of last year. 

But Charter, given some of the logistical issues with that (like modem transfers and the MSO’s ongoing all-digital upgrades), won’t yet commit on when 200 Mbps will be the minimum in all markets.

“We haven’t decided how fast we're going to go with that and how far we'll roll that out entirely this year,” Rutledge said.

Arris has been tabbed as a “key participant" in the development of WorldBox 2.0, a next-gen video platform that Charter Communications will be rolling across its footprint.

The announcement for the next-gen WorldBox also comes on the heels of a warrant agreement in which Charter can buy up to 6 million shares of Arris based on certain product purchases over the next two years.  

RELATED: Charter, Arris Ink Warrant Agreement

Like the first generation of the WorldBox, the 2.0 version will also be a hybrid IP/QAM platform that features a cloud-based interface. However, the new iteration, they said, will expand on Charter’s current downloadable conditional access capabilities and enhance legacy hardware-based security systems implemented across Charter’s new footprint.

RELATED: Charter Lights Data Centers for Downloadable Security

That combination will enable faster and more cost-effective deployment of the new platform, the companies said, noting that the new devices will support built-in security processing capabilities that are “now available in generic chipsets.” WorldBox 2.0 will also feature advanced graphics capabilities and processing power, they said.

Arris, which acquired U.K.-based Pace plc in January 2016 and Motorola Home in 2013, is the world’s largest supplier of set-top boxes, and apparently will be joining Charter’s mix of WorldBox  suppliers. Technicolor (via the acquisition of Cisco Systems’s set-top and CPE business nearly a year ago) and Humax are the other known WorldBox suppliers.

RELATED: Humax Enters Charter’s ‘Worldbox’ Orbit

Arris and Charter are also joint owners of ActiveVideo, the vendor that is enabling the MSO’s cloud-powered Spectrum guide on Charter’s prior-generation set-tops. Charter has already introduced Spectrum Guide in markets such as Fort Worth, Texas; and Reno, Nev. It’s made to run on the WorldBox as well as legacy, MPEG/QAM-only set-top.

Speaking on Charter’s Q2 call in August, company CEO Tom Rutledge said the plan is to have Spectrum Guide available in most legacy Charter markets by the end of 2016, and to launch it in some of the larger former Time Warner Cable markets by mid-2017, followed by rollouts in other TWC and Bright House markets through 2018.

"While Charter is focused on providing a secure video product on all devices, WorldBox 2.0 provides the same advanced video experience consumers are demanding on traditional television sets, and gives Charter the flexibility to deploy a single platform across our entire expanded network," Jim Blackley, Charter’s EVP, engineering and IT, said in a statement. "Our ongoing work with ARRIS – in developing this platform, including the downloadable security component – and the establishment of the warrant program, speaks to the strength of our long-standing relationship and the value of ARRIS's expertise in large-scale, next-generation deployments."

"We share Charter's vision for a new era of entertainment technology that leverages the power of the network and cloud to adapt to its subscribers' evolving needs," added Bruce McClelland, CEO of Arris. "With WorldBox 2.0, we're bringing to bear our expertise and scale to help Charter deliver next-gen entertainment experiences that will transform the way that its millions of subscribers will watch TV and access their favorite content on traditional television sets."

Cisco Systems and Roku said they are working together to enable Cisco’s Cisco VideoGuard Everywhere video service protection platform on Roku’s streaming players and integrated Roku TVs.

Cisco VideoGuard Everywhere, a software-based video security product whose roots stem from Cisco’s $5 billion acquisition of NDS in 2012, will also be used to support Charter Communications’ Spectrum TV app for Roku devices, they said.

Cisco and Roku added that they are collaborating to pre-integrate  VideoGuard Everywhere, a security system that compasses both conditional access and digital rights management, into Roku firmware starting next month. All Roku devices will be automatically upgraded to include Cisco security software.

Initial features and services the security integration support on Charter’s Spectrum TV app for Roku devices will include secure video-on-demand and linear TV playback, as well as control the number of devices that can be used simultaneously per subscriber account.

Charter is deploying the VideoGuard Everywhere solution across its systems, including the MSO’s new IP-capable “Worldbox” and Charter Spectrum TV apps offered on a variety of consumer electronic devices such as PCs, tablets and phones.

In February, Charter shed a bit more light on its downloadable security system, telling the FCC in a filing that it had completed two national centralized data centers to support the MSO’s new platform. Pursuing a retail option for that downloadable system was part of a set-top waiver that the FCC granted to Charter in 2013 that allowed the MSO to deploy dual-security boxes as it developed and deployed the new downloadable security platform. The FCC, meanwhile, is trying to move forward on new set-top rules that would apply to cable operators and other MVPDs and aim to "unlock" the set-top and spark a more vibrant retail market for video devices (the cable industry has argued that a new government mandate is unnecessary because the retail market for video devices that are capable of supporting pay TV is evolving amid natural market forces.). 

“We are always looking ahead for ways to make our customer experience better, providing more flexibility and options for accessing the television content people want to watch,” said Jim Blackley, Charter’s executive vice president, Engineering and IT, in a statement. “By expanding the Cisco downloadable security solution to our Spectrum TV App channel on Roku streaming devices, we can better control device streaming rights and functions within the home without compromising on the experience.” 

“We have been working closely with Roku to deliver a lower-cost, easy-to-deploy software security solution leading to innovative services like the Spectrum TV app on the Roku platform,” said Rajeev Raman, senior director of Strategy, Studio Design, and Product Management, Video Software and Solutions, Cisco. “Charter has been a pioneer in the industry for downloadable security to give its customers more options to watch what they want on the devices they want in their homes.”

“Utilizing the fast growing Roku streaming platform in combination with the Cisco VideoGuard Everywhere security solution enables operators to simply and securely deliver their branded video streaming services to the home, and optimally manage digital sharing rights for their content library,” added Andrew Ferrone, vice president of pay TV at Roku. “With this powerful combination, Charter continues to offer its pay-TV customers unique options to watch TV in ways that fit their lifestyles.” 

Confident that the bugs have been worked out and it has a scalable platform on its hands, Charter Communications is now weighing where and how rapidly it will deploy Spectrum Guide, its new cloud-based interface, across its legacy footprint.

“We’re rolling it out now and we have the ability to roll it out inside our own footprint this year, meaning the existing footprint,” Tom Rutledge, Charter’s president and CEO, said Thursday during the company’s Q4 earnings call, noting that it will of course take longer to get it in front of customers that would come way of Charter’s proposed acquisitions of Time Warner Cable and Bright House Networks. “Assuming we close sometime in the near future on those companies, we’re not going to get them completely rolled out this fiscal year but I think we can begin the process by the end of this year.”

Charter has launched Spectrum Guide in Fort Worth, Texas; and Reno, Nev. It can run on Charter’s new Worldbox, an IP-capable device that features a downloadable security platform, as well as the vast majority of its legacy, MPEG/QAM-only set-top – which number about 10 million --  thanks to a cloud-based deliver system from ActiveVideo, the vendor now co-owned by Charter and Arris.

Charter, he said, is still deciding how rapidly it will deploy Spectrum Guide in its existing systems -- whether to roll it out to all outlets en masse, or phase it in incrementally to just new customers and make it optional for current customers.

“We’re still wrestling with the right roll-out strategy,” he said. “But operationally it works very well and it's capable of being fully deployed." 

Rutledge also talked up the potential for Charter’s new platform to support OTT services and cross-platform search.

“It turns every TV into a connected smart TV and allows us to integrate third party video services including over-the-top providers like YouTube, Netflix, Hulu and Amazon Prime, giving customers the ability to search and view all of the content they’re interested in without changing consumer-owned hardware or devices,” he said, adding that the new guide is also being designed to support dynamic ad insertion. (UPC Hungary, a unit of Liberty Global, is using ActiveVideo's CloudTV StreamCast  tech to offer YouTube and other apps on non-IP set-tops). .

Cross-platform search, he said, would be consumer-friendly, but acknowledged that some business issues need to be ironed out first.

“The vast majority of our customers subscribe to us and over-the-top services,” he said. “We want our customers to be fully satisfied in their video experience and have that be as seamless an experience as possible.”

Rutledge was non-committal on DOCSIS 3.1, an emerging multi-gigabit IP platform that Comcast plans to deploy this year in a handful of markets. The first batch of modems based on D3.1 were recently certified by CableLabs.

“We didn’t specifically plan for it [DOCSIS 3.1] in legacy Charter in this fiscal year,” he said. But he expects the technology powering D3.1 to become available at “commercially deployable pricing” within the next 18 months.  “We expect that we will begin the transition in the new company over that time frame." 

Charter is also taking a wait-and-see attitude with the FCC’s proposed set-top rules.

“We haven't seen the proposal yet…fully, but we think it's a very dynamic marketplace and that the business is moving toward app-based display and cloud-based display. We’ll want to work carefully with the FCC as they attempt to change the marketplace as it currently exists.”

Charter Communications shed a bit more light on its downloadable security system, telling the FCC in a filing last week that it had completed two national centralized data centers to support the new platform.

Charter will be deploying the downloadable security platform in tandem with the rollout of the new IP-capable “Worldbox,” and has been rolling it out in dual-security boxes that supports an integrated form of Charter’s legacy security systems as well as the new version.

Charter deployed those dual-security boxes under an FCC waiver that expired at the end of 2015, and told the FCC last week that it was supporting 2.77 million set-tops with integrated security that were covered by that waiver. The FCC’s ban on integrated security boxes ended on Dec. 4, 2015, and is preparing to vote on a new set of set-top box rules.

“Charter commenced its deployments of a new downloadable Worldbox in 2015 and is readying deployment of Worldbox in markets throughout its footprint,” the MSO told the FCC in the filing, calling it a “closing declaration certifying its deployment of a downloadable security system.”

Speaking on Charter’s Q3 2015 call last fall, company president and CEO Tom Rutledge said the MSO was initiating deployments of its new cloud-based Spectrum guide and the Worldbox in St. Louis, Mo., and in Reno, Nev., adding that the MSO was about six weeks behind its original rollout schedule as it ironed out software issues. Humax and Cisco Systems are the known suppliers of the Worldbox (Technicolor acquired Cisco’s set-top box business last year).

Charter’s expected to provide an update on the rollout when it reports Q4 results on Thursday (February 4).

Though one aim of using boxes with downloadable security is to reduce the costs of the devices, Charter customers are not able to lease those devices at lower costs than the fees for Charter’s legacy set-tops, at least not in the early phases of deployment. “Lease charges for downloadable Worldboxes and for CableCARD-enabled set-top boxes are derived from a common equipment basket and are therefore the same,” Charter told the FCC.

Per the conditions of waiver granted by the FCC in April 2013, Charter said discussions with “a consumer electronics manufacturer are continuing,” and that the focus is on an app-based approach for service delivery, similar to Charter’s TV apps for iOS, Android, amazon Kindle and, moset recently, on Roku retail devices. Charter hasn’t announced that CE partner, but the MSO and TiVo have been in talks about a retail solution that would use Charter’s new downloadable security platform.

Charter said it met the public interest condition of making broadband service of 100 Mbps or greater available to 200,000 additional homes ahead of schedule, and is closing in on the completion of its digital conversion, noting that 99% of its subs have converted to all-digital.

Charter Communications’s rollout of its cloud-based Spectrum Guide and new “Worldbox” platform is admittedly behind schedule, but the operator is closing in on launching that product pairing in two markets, Tom Rutledge, Charter’s president and CEO, said on Thursday’s Q3 earnings call.

Spectrum Guide and the Worldbox (pictured), a hybrid QAM/IP device that uses Charter’s new downloadable security system, is being rolled out in St. Lois, Mo.; and in Reno, Nev., “imminently” he said.

Charter hinted in recent FCC filings that Worldboxes were starting to move out into the field, but with respect to the new UI/box mix, Charter is about six weeks behind its original rollout schedule as the MSO irons out software issues, Rutledge said. Earlier this year, Charter said it was also testing Spectrum Guide in Fort Worth, Texas.

Charter had hoped to have Spectrum Guide in front of 1.6 million subscribers this year, but “I don’t think that’s realistic or desirable at this point, given where we are starting,” Rutledge noted. “The plan is to roll it out as rapidly as we can operationalize it.”

So far, that delay does not seem to have hurt Charter, which bucked industry trends by adding 12,000 video subs in the third quarter.

Working primarily with ActiveVideo, a cloud video and apps vendor now owned by a Arris-Charter joint venture, Charter intends to offer the new UI across its set-top base, including non-IP digital boxes that rely on MPEG-based transport. Cisco Systems, which is selling its CPE business to Technicolor, and Humax are the known suppliers of Charter’s new Worldbox.

Rutledge did not shed more light specifically on the MSO's trial of Spectrum TV Stream, a skinny TV product for broadband-only customers that start at $12.99 per month and bundles in a free Roku 3 streaming player. 

But he did note that Charter’s Q3 numbers don’t factor in trial-related activities, while adding “We sell cable television services using IP technology and MPEG technology…What we’re selling is cable television in applications.”

Regarding apps, he said 1.4 million subscribers have downloaded TV Everywhere from Charter to receive services on iOS and Android devices as well as the Roku platform.

Rutledge also reiterated Charter’s position on usage-based broadband pricing: it doesn’t do it now, and has no plans to alter that stance. 

“We don’t do it,” Rutledge said. “We don’t do it because we want to sell more services. That’s our business model.” 

Charter Communications continues to move forward on a video strategy that incorporates cloud-based user interfaces and applications, and it now appears that a “remote” DVR is also starting to factor into that game plan.

In a filing with the Federal Communications Commission to show its support of Charter’s proposed merger with Time Warner Cable and Bright House Networks, Cisco Systems noted that it’s working with Charter “on a remote DVR trial for IP video to the home, and on backbone and regional access network upgrades to enhance Charter’s ability to support streamed video traffic through its network to the customer premises.”

The filing, first spottedFierceCable,  also mention that Cisco and Charter are working together to enable IP distribution via WiFi in and out of the home.

Cisco, one of Charter’s suppliers for a next-gen  “Worldbox” that supports a cloud-based interface and apps and is outfitted with a new downloadable security system, doesn’t get into specifics about Charter’s rollout plan for a remote DVR product.  A Cisco official told FierceCable that work continues in the lab as Charter prepares for field trials.

But word of the trial does appear to indicate that Tom Rutledge, Charter’s CEO, is still a fan of the general concept of the network-based DVR. Rutledge, as some might remember, championed the “remote-storage” DVR when he was the chief operating officer of Cablevision Systems.

Cablevision’s product, branded as the Multi-Room DVR, allows customers to record as many as 15 shows at the same time. Those customers can manage their DVR remotely, but playback is currently limited to the set-top box.

Comcast, meanwhile, has been pushing ahead with a “Cloud DVR” for its X1 platform that supports set-tops as well as tablets, smartphones and laptops and lets customers access their recordings at home or when they’re on the go.

Charter Communications has begun to deploy its new “Worldbox” to paying customers, the MSO revealed in a recent FCC filing that updated the Commission on the MSO’s rollout of a new downloadable security platform for set-tops and other types of video devices.

While the Worldbox is a device that is being leased by the operator, industry sources also confirm that Charter and TiVo are in talks about a retail solution that would employ the new downloadable security platform.

Charter, the MSO told the FCC, “deployed its first new Worldboxes to paying customers using downloadable security in April, 2015, and continues to ramp up the deployment of the downloadable security system throughout Charter’s systems. Enabling the Worldbox in any given footprint requires changes and additions to many pieces of the video delivery system, and those deployments are underway.”

Charter declined to comment further on its rollout of the Worldbox, a hybrid IP/QAM device that has at least two approved suppliers – Humax and Cisco Systems (which is in the process of selling its set-top and CPE business to Technicolor).

The Worldbox runs Charter’s new cloud-based Spectrum Guide, developed with ActiveVideo (Charter and Arris now own ActiveVideo via a joint venture). Charter has been testing the UI in Fort Worth, Texas, and has expressed plans to test it in markets such as Reno, Nev., and St. Louis.

Charter mentioned the Worldbox deployment update in a semi-annual report that it must file with the FCC per a condition for a waiver the MSO obtained in 2013 that allowed Charter to use dual-mode boxes equipped with integrated security and the operator’s new downloadable platform. Per the filing, Charter has deployed more than 2.67 million STBs with integrated security covered by the waiver as of June 30.

A condition of that waiver also requires Charter to engage in “good faith negotiations” with a CE manufacturer that intends to develop a set-top box to be sold at retail in the U.S. that uses Charter’s downloadable security system.

Regarding that status, Charter said talks with a CE manufacturer commenced in 2013 and that those talks are ongoing. Charter noted that it is “now awaiting further progress on technical details,” adding that talks with additional CE manufacturers commenced in the second quarter of 2015.

It appears that TiVo is one of the CE companies involved in those discussions.

TiVo, in a separate FCC filing about the company's interest in seeking clarity on cable’s ongoing support of CableCARDs, offered this nugget: “The TiVo representatives also responded to questions about discussions with Charter Communications concerning the use of Charter’s downloadable security solution in TiVo’s retail products as envisioned in the 2013 Order granting Charter a waiver of Section 76.1204(a)(1) of the Commission’s rules.”

Charter and TiVo declined to comment on any specific discussions pertaining to downloadable security, but industry sources confirmed that the two sides are talking about a retail-facing approach.

A retail agreement could tie up some loose ends. Charter stopped leasing TiVo boxes about two years ago (that tied into an agreement between them that was announced in January 2011), but how those two companies might continue to work together has been a lingering question ever since.

Charter’s development and deployment of a downloadable security system for set-tops and other video devices comes amid a backdrop in which an FCC-appointed committee mulls a potential successor to the CableCARD. That group, called the Downloadable Security Technology Advisory Committee (DSTAC), is tasked with filing its recommendations to the FCC by September 4, though consensus on a unified approach has proved elusive thus far (subscription required). 

Charter plans to expand the deployment of the new UI and  Worldbox to systems that are coming way of its proposed acquisition of Time Warner Cable and Bright House Networks. 

Charter confirmed earlier this year (subscription required) that it has licensed the Reference Design Kit and has established two parallel development tracks: one that factors in its current technical approach and one that also includes the RDK, a preintegrated software stack for video and broadband devices that’s being managed by Comcast, TWC and Liberty Global.

Charter Communications is in the process of separating its businesses services operations into two groups – one that will focus on small- and mid-sized businesses (SMBs), and another that will target larger, enterprise commercial customers and also utilize the operator's new "Spectrum" branding, Tom Rutledge, Charter’s president and CEO, said Thursday on the MSO’s fourth quarter earnings call.

That shares similarities with the playbook used by Cablevision Systems, Rutledge’s former company, which leans on one division to serve SMBs primarily via HFC, and another, Lightpath, to support larger enterprise customers with a fiber-based Metro Ethernet platform.

Word of Charter’s new business services set-up comes amid a generally solid fourth quarter in which the rate of business services revenues growth slowed a bit. Charter pulled in $262 million in business services revenues in the fourth quarter, a 16.1% increase versus the year ago quarter. The $253 in commercial revenues generated in the third quarter of 2014 represented a year-on-year increase of 17.7%. Rutledge attributed the difference in growth rate in part to a slowing of Charter’s cell tower backhaul business.

Looking ahead, he said Charter intends to accelerate growth in the business services segment with new product and pricing strategies, adding that the MSO will also be in position to take advantage of a more attractive footprint following pending system swaps and transactions that won't happen until after Comcast and Time Warner Cable seal up their proposed merger.

On the residential side, Rutledge also offered an update on the rollout of Charter’s new cloud-based Spectrum Guide, setting a goal to have it deployed to over half of its retained footprint, or about 1.5 million video subscribers, in 2015.

Charter hasn’t announced which markets will get it first, but it’s using technology from ActiveVideo Networks and Zodiac Interactive that will allow the MSO to offer the new UI on all two-way, interactive set-tops, regardless of age or processing power, including old DCT-2000s or its new IP-capable Worldbox. Amplifying why Charter has eschewed the use of downstream-only Digital Transport Adapters (DTAs) for its all-digital deployment, Rutledge noted that the new UI won’t run on one-way DTAs (Comcast has suggested that it’s technically possible to "force-tune" a DTA using an iPad or another mobile device that rely on an IP-based upstream connection).

Rutledge was also asked to give his read on the FCC’s decision to raise the definition of broadband to 25 Mbps down by 3 Mbps upstream, and what share of Charter’s footprint is being served by telco competitors with that level of service. According to Rutledge, U-verse’s average customer gets 6 Mbps, while Charter markets a baseline service of 60 Mbps down. Charter has a 4% overlap with Verizon FiOS.

“From a practical point of view today, we are dramatically different than they are,” Rutledge said of AT&T U-verse, later suggesting that Charter might be served by shifting its marketing strategy to: “AT&T doesn’t sell broadband,” but that the MSO has not made a decision to do that.

AT&T launched a 75 Mbps U-verse tier in some markets last year, complementing iers that deliver downstream speeds of 6 Mbps, 12 Mbps, 18 Mbps, 24 Mbps, and 45 Mbps, respectively. AT&T has also introduced 100 Mbps and 1-Gig services in select areas where it has begun to introduce its new fiber-based “GigaPower” service.

Charter Communications has promoted Rich DiGeronimo to the post of executive vice president, product and strategy, and a role in which he will continue to report to John Bickham, Charter's chief operating officer.

DiGeronimo has been serving as Charter’s SVP, product and strategy since 2011, and has been overseeing the development and deployment of several new Charter offerings, including the Charter TV app, the Spectrum Guide, and the recently announced Worldbox, a new class of hybrid QAM/IP devices CES that will support the operator's new cloud-based UI and Charter’s downloadable conditional access system.

He has also played a big role in coordinating “many internal initiatives,” including Charter’s recently completed all-digital transition, the MSO noted.

"Rich and his team have been an important part of the transformation of Charter over the past several years," Bickham said, in a statement. Rich's leadership in the development of products and services ranging from the Charter TV App to the Spectrum Guide are at the heart of our strategy moving forward and will help Charter continue to be the leading provider of cable services in our markets." 

For more about Charter’s tech transformation, please see this story (subscription required) and interview with DiGeronimo from last fall, when Charter was named MSO of the year by Multichannel News.

Prior to joining Charter in 2008, DiGeronimo was VP and GM of cable markets at Level 3 Communications, and is also late of Bear Stearns, where he worked in investment banking focused on technology firms. 

Humax has been selected as a second source for the “Worldbox,” a next-gen class of hybrid QAM/IP video devices from Charter Communications that will support the MSO’s new downloadable conditional access system (DCAS) and its cloud-based interface and applications.

A Charter spokesperson confirmed the selection of Humax, but wouldn’t talk about the financial terms of the agreement or what percentage of Charter’s Worldbox business would be going to the South Korea-based supplier.

But the selection is a clear indicator that Charter intends to source boxes from a variety of suppliers using an “open” downloadable security architecture that is also in use at Cablevision Systems. Samsung Electronics and Humax are among the known vendors Cablevision has picked to supply “Future Services Portal” boxes that utilize its DCAS.

At the International CES earlier this month, Cisco Systems was revealed as the first supplier of the Worldbox, which will initially feature two models -- an HD-DVR and an non-DVR HD client device (the Cisco-made non-DVR model is pictured above). Cisco has been tapped as a “key” supplier of Worldboxes through 2015, providing a “substantial share” of them to Charter, while also supplying the platform’s downloadable conditional access system and digital rights management platform.

Charter hasn’t announced any other Worldbox suppliers. However, Arris hopes to be in the mix, as it will have “equal opportunity to bid on the Worldbox [business], as any other competitor,” Bob Stanzione, Arris’s chairman and CEO, said last week at an investor conference.

 Humax officials have yet to comment for this story, but the selection by Charter obviously gives its U.S. cable ambitions a boost.

Last April, Time Warner Cable announced that it had picked Humax to build the MSO's first device based on the Reference Design Kit (RDK), a preintegrated software stack for video and broadband devices that is being managed by Comcast, TWC, and Liberty Global.  What is not known is how that deal, which centers on an IP-based HD client that can support TWC’s next-gen UI, will carry forward if and when Comcast and TWC complete their proposed merger.

Humax has also been linked to the Xi3, an IP-only, RDK-based client device that Comcast is developing for its X1 platform (a Humax-made model passed through the FCC in 2012). Comcast, however, has been using Xi3s made by U.K.-based Pace for its initial rollout.

While Cisco Systems was identified at last week's CES gadgetfest as a “key” supplier of Charter Communications’ new "Worldbox” through 2015, the market “overreacted” to the news, according to Bob Stanzione, Arris’s chairman and CEO.

“The conclusion was jumped to that Cisco was going to take a big share of this Worldbox business,” Stanzione said Tuesday during an investor conference in New York put on by Needham & Company. Such an interpretation is "absolutely incorrect," he said. 

To be fair, Charter CEO Tom Rutledge stressed at last week’s Cisco presser in Las Vegas that the beauty of the Worldbox approach, which will use an “open” downloadable security platform from Cisco, is that it will allow the MSO to buy boxes from multiple suppliers that can be used in all systems that have implemented the new security system. He also brought up Arris by name as one of its STB suppliers, and mentioned that the new platform will also give Charter an opportunity to support devices sold at retail.

But concerns about Arris’s role with Worldbox came up during Stanzione’s talk, so he wanted to clear up that he expects Arris to have more than a fighting chance to be in the mix. Worldbox, he said, “levels that playing field” for set-tops. “Quite honestly, I don’t see this as changing the competitive dynamic in terms of our ability to sell CPE to Charter,” Stanzione said, noting that the company will have “equal opportunity to bid on the Worldbox, as any other competitor.”

And he said the technical specs around Worldbox aren’t “completely specified” yet, so there.

But it’s also understandable that last week’s announcement got the attention of Arris investors.

After all, it’s got some significant turf to protect. Arris, which became a fixture in the STB market after buying Motorola Home in April 2013 for $2.35 billion, held a leading 32% of the cable set-top market from a revenue standpoint in the third quarter of 2014, according to Infonetics Research.

Stanzione also addressed the role of ActiveVideo Networks, which will allow Charter to bring its new UI to all boxes – the new IP-capable Worldbox and millions of already-deployed set-tops that don’t speak IP.

Stanzione acknowledged that the approach will decrease the number of boxes Charter will need to buy, “but it doesn’t eliminate the need for new set-tops,” as older ones won't last forever and will still need to be replaced eventually.  Comcast, Arris’s biggest customer, has been conducting a small test with ActiveVideo in Chattanooga, Tenn., (for a VOD interface) but has not announced any plans to expand on it.

But Worldbox wasn’t the only topic. With earnings on the horizon, Arris is in a quiet period, but Stanzione reiterated that Arris is pushing ahead while four of its top five customers (AT&T, Comcast, Time Warner Cable, and Charter Communications) are all involved in mergers and acquisitions that will further consolidate the industry.

“I can only say business is good,” he said, but was hopeful that there will be an acceleration in spending in areas where Arris is involved when those deals get wrapped up.

He’s also bullish on the prospects of DOCSIS 3.1, noting that it will spark a “big replacement cycle” for CPE, as it did during cable’s move from DOCSIS 2.0 to DOCSIS 3.0, and will cause MSOs to update their network gear.

Stanzione also weighed in on the specter of broadband being reclassified under Title II, but said it was tough to predict its impact until it's known how heavy or light a hand will be applied. 

In the meantime, it does introduce a “subtle effect,” burdening Arris's customers to lawyer up and spend resources negotiating with regulators. Despite the rhetoric around Title II, Stanzione was confident that cable, telcos and satellite operators will still need to invest in their networks. 

Las Vegas – International CES – Charter Communications and Cisco Systems used this week’s gadget-fest to unveil the “Worldbox,” a hybrid IP/QAM video device that will use downloadable security and a cloud-based interface that will serve as central components of the MSO’s next-gen video platform.

The companies also announced that Cisco will serve as  a “key” supplier of the Worldbox through 2015 as well as the device’s downloadable conditional access system (DCAS) and digital rights management platform (Charter will use Cisco’s VideoGuard Server for the DCAS and its VideoGuard DRM for security on client devices).

Financial terms were not disclosed, but Cisco will supply a “substantial share” of Worldboxes while also continue to provide CableCARD boxes to Charter until it migrates current and acquired systems to the new DCAS solution. Execs here said the DCAS in use by Charter shares the same “open” architecture for the downloadable system now deployed by Cablevision Systems.

Here during an event for press and analysts, Charter and Cisco showed off the Worldbox and the cloud-based guide that will grace it. Charter has already developed two versions of the Worldbox – and HD client (pictured) above and an HD-DVR model that will come equipped with 1 terabyte of storage. Both models contain 16x4 DOCSIS 3.0 cable modems, 1 Gigabyte of RAM and USB connections “to enable future applications.”

Charter expects to start deployments of the Worldbox and the new downloadable security system in select markets in “early 2015,” an MSO official said. Charter is currently testing the Spectrum Guide with tens of thousands of customers in Ft. Worth, Texas.

Looking ahead, Charter expects to deploy downloadable security to its current systems this year, and then will continue deployment to acquired systems that will come way of a deal that hinges on the pending Comcast-Time Warner Cable merger.

Charter will also look to deploy the new guide to all set-top boxes across its footprint, including older boxes that don’t speak IP, by leaning on a system from ActiveVideo Networks that processes the guide on the network and send the video content and the interface in an MPEG stream. Update: Zodiac Interactive is supplying the software stack powering the device. 

That network-based approach  “makes every box and every TV in the Charter footprint state-of-the-art,” Tom Rutledge, Charter’s president and CEO, said. It also means Charter won’t have to swap boxes to get its new UI deployed broadly. "Smart networks make dumb screens smart," he added. "We can take any kind of device and make it a sophisticated device." 

Rutledge also talked up the economics of the new platform, calling it a “breakthrough in terms of cost and capability.”

While Cisco is Charter’s initial source for the device, Charter is expected to add others into the mix. Charter said it is working with vendors toward manufacturing compatible boxes for the retail market as well.

The network-based processing system will also pave the way for Charter to render its UI on retail boxes. Here at the show, Charter showed a proof-of-concept of the Spectrum Guide running on a Roku box.

“We are proud to join Charter today to showcase the leading edge IP and cloud-based video solutions they are developing, and the Cisco products at their core, Cisco chairman and CEO John Chambers said in a statement. “We are proud to join Charter today to showcase the leading edge IP Charter’s new video solution, featuring cloud-driven video experiences offered across many devices will be a huge win for Charter subscribers.”