Charter’s Stimulus Plan

MSO Will Offer Free Broadband to Low-Income St. Louisians

By MCN Staff -- Multichannel News, 3/15/2010 7:15:00 AM

Charter Communications is opening a second front in the battle to boost broadband adoption. Last week, the company said it is launching a two-year program, in tandem with One Economy, to provide free broadband service, training and equipment to 1,000 low-income residents of its hometown of St. Louis, Mo. It is already a partner in the cable industry’s Adoption- Plus initiative to provide half-price service to homes with middle-school kids, but that initiative is contingent on government-funded education programs, while Charter’s free service will be ready to roll in weeks. Multichannel News Washington bureau chief John Eggerton spoke with Charter chief marketing officer Ted Schremp about the project.

MCN: Why offer free broadband?
Ted Schremp: There has been lots of discussion about the broadband-stimulus program over the past year. We had various discussions with the Federal Communications Commission and One Economy, and decided to take the same approach that we take in our overall marketing strategy.
We like to do trials and pilots and execute on something informed with the best available information as to what is going to work, try it, see if it works, and then we could potentially expand it.

MCN: What is going to be the criteria for being one of the lucky 1,000?
TS: One Economy is bringing the education and training pieces to the table, as well as jointly with community partners looking to solve the hardware availability issues. There is a recruiting and training process with local partners like Habitat for Humanity. It is generally tuned toward low-income, though not necessarily age-based as are some of the other programs.

MCN: How will you measure success?
TS: We like to execute, measure and evaluate. One Economy will do a set of analysis before and after on penetration levels, awareness levels, and as we execute the program, we will see if we made an impact. That will be shared across the industry and with the FCC.

MCN: Is all the funding coming from Charter?
TS: Yes. There will be multiple paths, including loans and grants.

MCN: How long will the service be free?
TS: For two years.

MCN: And how much will this cost?
TS: The total value of the program, if we were to charge market rates for the broadband, is about $700,000 over two years.

MCN: Will this just be broadband service, rather than the whole bundle?
TS: Yes, just broadband, though some of the folks that are participating in the program may very well have video services from us today. We’re certainly interested in the general marketplace in creating relationships. We obviously love the triple-play bundle (voice, video and Internet) and love bundles generally, but are certainly happy to solve folks broadband needs.

MCN: When do you hope to have everyone hooked up?
TS: We expect it to take on the order of three or four months to get folks through the training program and up and running. There is obviously a level of awareness that we need to generate in the target market and then get folks through the training program.

MCN: Will you expand the program?
TS: I think it depends on the outcome of this pilot. If we see some early success we may broaden it in terms of participation here in St. Louis or geographically. But, as you said, we are involved in the A-Plus program and over the next couple of weeks we will see where that takes us. But we expect to get some early learnings that will help all of those discussions.