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CHARTER COMMUNICATIONS, INC. /MO/ filed this Form 425 on 06/16/2015
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take everything about you that’s good and give it to the customer. And give it to them upfront. And that means, when you do promotional pricing to entice people to switch - and it’s hard to get people to switch. Because don’t forget, if they left us six years ago to go to satellite and we were an analog service and they had bought a flat-screen TV…
RM: And that’s what they remember.
TR: …that’s what they remember, exactly. So, us overcoming that inertia is going to be a real challenge. So first things first, you’ve gotta go for being the best and being high-quality. And we know that we’re better and then selling ourselves through time - and it takes time - and convert people back to us by having the best products available. And that…it’s really quite simple. Now, it’s simple to say, there’s a lot of moving parts. This company is going to have 90,000 people.
RM: Yes.
TR: And being coordinated and being uniform and having, having your products work the same way, everyway, everywhere. Those are management challenges all throughout the organization that we’ll have to work on. But I’m confident we will and be successful.
RM: Let me shift gears to the business services opportunity for a second. One of the things we’re particularly proud of is the growth we’ve generated in business services over the last, really, four or five years. And it’s an area where we still see a whole lot of growth ahead of us, even independent of the transaction. But, one of the things I’ve found exciting about consolidation in this business is the opportunity to unlock incremental value in business services and the idea of putting together Time Warner Cable, Charter and Bright House really holds out a fair amount of additional opportunity in business services. How do you think about that?
TR: Well, no, I agree. I don’t know Time Warner’s numbers as well as I know Charter’s but so like proportionally in Charter, enterprise services is about $700 million business.
RM: OK, for us we’re roughly, this year, a little over $3 billion.
TR: Right, so bigger. Way bigger. But our proportion of the share of the market is about seven percent. So it’s a $10 billion business inside of Charter’s footprint, which would make that a $35 billion business inside of the new company, at least.
RM: Yes.
TR: And so, at $3 billion, you’re talking ten percent penetration. So it’s an under-penetrated business and so a huge opportunity for us to bring quality, competitive telecommunications products to businesses. And it’s an area that’s underserved and it’s one of the things I’ve committed to, as part of this transaction, is to build out more business parts and to build out some speculative construction like we did in the residential business.