Charter Communications, Inc. CHTR recently launched a website – enterprise.spectrum.com – that will offer content and particulars regarding reliable and scalable network solutions specifically for mid and large-sized business organizations.
The new website complements Charter's existing Spectrum and Spectrum Business websites, and is designed to address a range of industries along with government and educational institutions, carriers and partners.
Notably, the site is simple to use and offers easy access to resources such as white papers, videos and infographics. It also provides a portal to get in touch with a local, dedicated account representative.
Interestingly, the rapidly developing business services division has become a major boon for cable MSOs (multi-service operators) in the U.S. and Charter has been aggressively targeting this space. In third-quarter 2015, Charter’s commercial revenues totaled $286 million, up 13.2% year over year, on the back of higher sales to small and medium-sized business customers (SMBs) and wholesale service providers.
We note that there are plenty of untapped opportunities in the business services market, particularly in the mid and large-sized business segment. Thus, it makes sense for Charter to make efforts to establish itself in the lucrative large enterprise segment which has for long been dominated by larger wireless carriers like Verizon Communications Inc. VZ and AT&T, Inc. T.
Notably, the high commercial revenue prospects have been the rationale behind Charter’s plans to acquire both Time Warner Cable Inc. TWC and Bright House Networks. Thus, Charter is set to become a formidable player in the large business segment post its pending acquisition of Time Warner Cable, which boasts a huge base of large enterprise customers. The combined entity is likely to achieve the necessary economies of scale to serve large business enterprises.
Of late, Comcast Corp. CMCSA has been firing on all cylinders to maintain its leading position in this space and also to gain more traction.
Nonetheless, we believe that providing a dedicated site to mid and large-sized business enterprises should help Charter attract more customers, boost revenues and gain competitive edge against Comcast.
Charter currently has a Zacks Rank #3 (Hold).
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