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Altice Sets a ‘Smart Pipe’ Strategy

Not too long ago, the worst thing you could call a cable company was a “dumb” pipe. Today, with the advent of broadband and mobile services that can deliver high-quality over-the-top video cheaply and efficiently, most cable companies don’t mind the pipe part. But it is anything but “dumb.”

Altice USA is one of the newer players in the U.S. cable business, having bought Suddenlink Communications and Cablevision Systems in the past three years. Already, the company has ambitious plans: Last year, it launched a fiber-to-the-home build and this year, it began rolling out a new home network hub, Altice One, to its 4.6 million subscribers. 

Hakim Boubazone,  Altice USA co-president/COO

Hakim Boubazone,  Altice USA co-president/COO

Altice USA’s co-president and chief operating officer Hakim Boubazine spoke with Multichannel News about Altice USA’s approach to the cable business. An edited transcript follows.  

MCN: Many cable companies have been integrating subscription video-on-demand services like Netflix into their set-tops, making it easier for customers to access content from what were once thought of as competitors. What is your approach to that?
Hakim Boubazine:
Our approach has been to offer a portal where you can access linear or OTT in the same fashion, a one-stop experience where you can get YouTube and Netflix and [much] of the content that we have or we plan to have in a relatively seamless way. Customers want one access point.

Related: Altice USA Integrates Netflix Across Optimum Footprint on New Platform

[It’s] not an app in the box, it’s a deep integration whereby when you do a search, to have Netflix metadata tapped in, so whenever you ask for a movie by Tom Cruise, you get recommendations coming from all over the place, Netflix and many other OTT players with whom we are deeply integrating our portal.

MCN: Where do you see that evolving?
We keep embracing OTT until we come to a point like we are doing in Europe, which is a market that is more mature than the U.S. in the sense there is more competition and where everybody has already moved to a quad play and operators even have OTT offerings that they are bundling with mobile. I think we will move into that world in a matter of time. It is moving slowly.

Related: Altice USA Improves Video Sub Losses in Q1

We definitely see an appetite for OTT supplementing the linear experience and we also see cord-nevers, people who were not born in the cable era, and who have an appetite only for OTT, internet and mobile. That is a segment we would tackle with IP services, around our MVNO [mobile offering] but around our internet as well.

MCN: Is there a danger of cable becoming a “dumb” pipe though? Or is that not such a bad thing anymore?
It’s always been a pipe. It’s become a smart pipe over time with analytics and data and the things that today enable you to collect and send data to customers that enable more services. That drives growth with more bandwidth and efficiency, with less latency, and it moves to a world where you can offer everything IP. Not only has it become smart, it has become very versatile in terms of everything it can transport. It’s moved from being a pipe to a smart pipe to a strategic asset.

MCN: You are planning to launch a mobile service next year. How are you planning to tackle that?
The mobile play for us is slightly different than the one Comcast and Charter have in play in the sense that what we are running is what we call a “facilities MVNO.” We are deploying our own core infrastructure, packet gateways and all the mechanics to be able to manage our own SIM card, our own services. We will be able to manage our own roadmap in terms of the services that we plan to create between fixed and mobile. It’s a different setup.

We are not just launching a mobile service. Our strategy is to basically launch the quad play.

We want to be able to offer any type of bundles. Whether you want to bundle mobile with the triple play, or with a pure OTT product and have internet. That’s part of the natural evolution of any cable operator. We own that smart piece of pipeline that feeds our network, including the mobile one. It becomes an extension of the business. Mobile is one of the missing pieces today.