News

Charter’s Stimulus Plan

3/16/2010 7:16 AM Eastern

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.