cable television, computers and telecommunications. Mr. Allen believes that this
convergence, which he calls the "Wired World," will rely on the cable platform
to deliver an array of new services, such as digital video programming,
high-speed Internet access, Internet protocol telephony and electronic commerce.
Because of cable's ability to provide all of these services, we believe that
individuals and businesses will view cable as an important service.
Our business strategy is to grow our customer base and increase our
operating cash flow by:
- maximizing customer satisfaction;
- implementing decentralized operations with centralized financial
- pursuing strategic acquisitions;
- upgrading our systems;
- emphasizing innovative marketing; and
- offering new products and services.
MAXIMIZING CUSTOMER SATISFACTION. To maximize customer satisfaction, we
operate our business to provide reliable, high-quality service offerings,
superior customer service and attractive programming choices at reasonable
rates. We have implemented stringent internal customer service standards which
we believe meet or exceed those established by the National Cable Television
Association. In 1998, J.D. Power and Associates ranked the companies then owned
by us third among major cable system operators in overall customer satisfaction.
We believe that our customer service efforts have contributed to our superior
customer growth, increased acceptance of our new and enhanced service offerings
and increased strength of the Charter brand name.
IMPLEMENTING DECENTRALIZED OPERATIONS WITH CENTRALIZED FINANCIAL
CONTROLS. Our local cable systems are organized into seven operating regions. A
regional management team oversees local system operations in each region. We
believe that a strong management presence at the local system level increases
our ability to respond to customer needs and programming preferences, improves
our customer service, reduces the need for a large centralized corporate staff,
fosters good relations with local governmental authorities and strengthens
community relations. Our regional management teams work closely with senior
management in our corporate office to develop budgets and coordinate marketing,
programming, purchasing and engineering activities. In order to attract and
retain high quality managers at the local and regional operating levels, we
provide a high degree of operational autonomy and accountability and cash and
equity-based performance compensation.
PURSUING STRATEGIC ACQUISITIONS. We intend to continue to pursue strategic
acquisitions and believe that the current consolidation activity in the cable
industry offers substantial opportunities to further our acquisition strategy.
We believe that there are significant advantages in increasing the size and
scope of our operations, including:
- improved economies of scale in management, marketing, customer service,
billing and other administrative functions;
- reduced costs for plant and infrastructure;