Charter Communications Introduces New Cable TV Packages to Compete with Streaming Services, Focuses on Sports Networks

Cable and broadband company Charter Communications, Inc CHTR plans to introduce a new two-tier cable package system that offers customers more flexibility in selecting their TV packages, particularly concerning sports networks.

The decision comes as the cable TV industry faces challenges from the growing popularity of streaming services, which has impacted sports channels and regional sports networks. Netflix Inc NFLX also focuses on sports-related content to boost streaming revenue.

Also Read: Warner Bros Set to Launch 'Max,' New Streaming Service to Compete with Netflix and Disney

The new system, set to launch in the third quarter, will include Spectrum Select Plus, offering a full slate of sports programming and regional sports networks, and Spectrum Select Signature, which will exclude specific sports programming at a reduced rate, CNBC reports.

Charter's move aims to address the changing consumer preferences and provide a more affordable option for non-sports viewers while still catering to sports fans.

Customers who choose the sports programming option will receive free direct-to-consumer streaming apps for local sports networks in their area, enhancing the viewing experience.

Charter's model supports sports networks' pursuit of streaming options and acknowledges the shift in the marketplace towards direct-to-consumer choices.

As a distributor and owner, Charter is vulnerable to the challenges faced by sports networks, including its ownership of Spectrum SportsNet and SportsNet LA.

Charter and DirecTV have also reached a new distribution agreement for regional sports networks, allowing DirecTV to target subscribers interested in Lakers and Dodgers programming while providing more flexible options for customers uninterested in sports.

The deal reflects the evolving business model for regional sports networks to adapt to the current marketplace and offer customers more control over their viewing choices.

In April, Charter reported first-quarter FY23 revenue growth of 3.4% year-on-year to $13.65 billion, beating the consensus of $13.62 billion.

Charter added 67,000 residential Internet customers, compared to 164,000 last year. Residential video customers decreased by (237,000) versus a decrease of (123,000) in the prior year.

Price Action: CHTR shares closed higher by 0.16% at $372.54 on Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.