Even for Charter Communications, a company that actually added 56,000 video users in 2020, it seems like the end days in regard to traditionally bundled linear pay TV.
With U.S. pay TV operators losing another 6 million customers last year, Charter’s chairman and CEO, Tom Rutledge said bundled linear services are being “priced out of the market” by lower cost direct-to-consumer streaming platforms.
Speaking Tuesday at Morgan Stanley’s annual Technology, Media & Telecom conference, Rutledge said Charter will remain in the video business. But he seemed to describe a future in which the cable company resells third-party OTT services.
“It’s important that we be a video connectivity company as well as a broadband company and a mobile company,” Rutledge said. “We need to satisfy a customer’s full range of connectivity issues.
“I think we can manage our video relationships with customers going forward and we can sell streaming packages and be a storefront and an aggregator,” he added. “The industry will segment into much narrower niches. People still spend a lot of time on the big screen and there’s an opportunity there for us to be the best provider of those products because of our customer relationships, and to have a higher-quality product and a more valuable product.”
Rutledge also pointed out that from Disney Plus on down, none of the direct-to-consumer services recently launched have been nearly as profitable as linear pay TV was just a few short years ago.
“The new streaming and on-demand products really haven’t been successful from a linear perspective yet,” Rutledge said.
