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The rate of cord cutting will begin to slow down, says Charter Communications CEO

Key Points
  • Cord cutting will begin to slow down, argues Charter Communications CEO Tom Rutledge. 
  • I'm not saying the category is not under pressure, but I think the rate of decline will slow," he tells CNBC's David Faber.
  • Some analysts argue the growing number of streaming services will accelerate the speed of cord cutting. 

The number of people ditching their cable subscriptions will not continue at its current pace, Charter Communications CEO Tom Rutledge told CNBC's David Faber on Thursday. 

"I think, in aggregate, they're going to slow down," Rutledge said on "The Exchange." "Most single-family homes have big TVs in them, and that's where you get sports … That's where you get live TV like this. It's going to still be under price pressure. I'm not saying the category is not under pressure, but I think the rate of decline will slow." 

Rutledge's remarks stand in contrast to the dominate narrative surrounding cable television, which has been losing subscribers as customers "cut the cord" in favor of alternative ways of viewing such as internet streaming.

And many analysts argue the increasing number of streaming services will only accelerate the number of cord cutters.

In the third quarter of 2019, major U.S. pay-TV providers lost around 1.74 million video subscribers, according to the Leichtman Research Group. That is up from a loss of 975,000 subscribers in the same quarter last year. 

Rutledge said belief that cord cutting will decelerate is because a lot of the damage from the "high-priced environment we've been in" is already done. 

"The lack of security with password sharing, you know, kids going to college with their parents' password. That whole college market is gone, and the second-home market is gone to a certain extent," said Rutledge, who has led Charter Communications since 2012.

The Stamford, Connecticut-based company delivers a wide range of cable television, internet and voice services to homes and businesses customers through the Spectrum brand. 

Liberty Broadband — part of billionaire John Malone's empire, which also includes Liberty Media — owns a 24% stake in Charter Communications.

Rutledge, who said Charter has an opportunity to grow its revenue through increased market penetration, also said he disagreed with the use of the term cord cutting to begin with. 

"We're actually adding lots of cords. Broadband subscriptions, connections that we sell, mobile, broadband — they're increasing and they're accelerating in terms of the rate of growth," he said. 

Rate of cord-cutting will slow: Charter CEO

source: CNBC


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