Spectrum customers show company the consequences of hiked prices
Spectrum customers are starting to hit the cancel button. Charter Communications (CHTR) the parent company of Spectrum, has just revealed that it has lost 72,000 internet customers and 405,000 cable TV customers during the first quarter of 2024.
“Our internet customer growth remained challenged by a low movement and generally low activity environment, coupled with continued elevated competition at least in the short term and a small impact from fewer low-income connects due to discontinued ACP availability,” said Charter CEO Chris Winfrey during a recent earnings call.
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The Affordable Connectivity Program (ACP) was a government program that Spectrum offered, which provided eligible households a discount of up to $30 a month for internet. It was discontinued in February this year.
Losing cable TV customers
In its first-quarter earnings report, released on April 26, Charter reported that it has a total of 29.8 million residential customers, which is a 0.7% decrease from the 30 million it had during the same quarter last year. The company claimed during the earnings call that this was mainly driven by the loss in cable TV customers.
It is no surprise that Charter is experiencing a dip in cable TV subscribers, a phenomenon called “cord-cutting.”
Cable companies have seen many customers canceling their cable TV services in favor of subscribing to streaming services such as HBO, Hulu, Disney+, etc., which offer lower prices compared to cable.
Charter’s residential revenue also took a small hit this year. During the first quarter, it brought in $10.8 billion in residential revenue, down 0.4% from a year ago.