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CHARTER COMMUNICATIONS, INC. /MO/ filed this Form 425 on 02/05/2016
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FEBRUARY 04, 2016 / 03:00PM GMT, CHTR - Q4 2015 Charter Communications Inc Earnings Call

Mike McCormack - Jefferies LLC - Analyst

Thanks. Tom, just maybe a quick comment. We heard more clarity coming out of Comcast yesterday, regarding the Spectrum auction. Your thoughts on that auction going into 2016? And then maybe just a quick comment on what you're seeing, with respect to off-promo churn? It seems like those customers are not churning out, but just wanted to verify that. Thanks.

Tom Rutledge - Charter Communications Inc - President and CEO

Right. With regard to the auction, we're not in exactly the same place as Comcast, because we have this pending transaction. And at this point, we can't be assured of what our footprint is. And so it's difficult for us to participate in the auction without regulatory clarity. And we haven't -- for instance, even in the Time Warner assets and Bright House assets, we know there's an MB&O, but we haven't actually seen it. And so we have a lot of unknowns, in terms of our ability to participate.

We've considered participating by potentially filing the application. But if the timeline is as projected, we're not going to really be able to do it, given our regulatory status. With regard to off-promo churn, we've been reducing our churn throughout the year, as a result of the quality of our products. And our off-promo churn is not inconsistent with that general trend.

Mike McCormack - Jefferies LLC - Analyst

Okay. Thanks, Tom.

Stefan Anninger - Charter Communications Inc - VP of IR

Thanks, Mike. Operator, next question please.


Your next question comes from the line of Ben Swinburne with Morgan Stanley.

Ben Swinburne - Morgan Stanley - Analyst

Good morning. Can you guys talk a little bit about the revenue drivers for 2016 versus prior year, since you're not taking a rate increase? In other words, do you expect to get more volume, because you typically put a price increase, and you're not going to? So the revenue growth will be shifted more to volume in 2016? And maybe any more color on your decision process there? And then I just was wondering if you could talk about DOCSIS 3.1? And what the technology road map looks like for Charter, in deploying that across -- at least the standalone footprint? Thanks.

Tom Rutledge - Charter Communications Inc - President and CEO

Sure. So Ben, if you take a step back to the high level, 2015 had very little in the way of price increases, as well. So 2016 is not going to be that dramatic. The reality is, if you're growing your residential customer base at 5% plus, there's not much that you need to be doing on the rate side, and you can be extremely competitive, and go to grow and provide value to consumers. And so 2016, we have more momentum in the marketplace than we did coming in to 2015. And there's even less need than in the past to have to take rate increases.

You also have SMB and enterprise, which right now you've seen a decelerating trend on revenue growth, but an accelerating trend on PSU growth. And we'd expect that, over time, SMB and enterprise would perform a lot like residential did in the late 2012, 2013 timeframe. And our goal is to re-accelerate the growth for revenue, not just customers and PSUs on that side, as well. Clearly, we're in a political advertising year, as well. And sometimes, that's unclear how much of that is going to flow to you.

But similar to what we've done in prior years, we'll always isolate that political advertising, so that people have clarity around it, so that they can isolate the growth rates in the good and in the bad. So we'll be doing that throughout the course of this year, as well. So I don't think that -- to put it bluntly, I don't think that a lower amount of rate increase really has a dramatic impact, because of our improved ability to grow.


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