Implications Of Charter’s Deal With Comcast

The telecom world is bustling with the news that Charter Communications is planning to team up with Comcast Corporation. It is said that both the service providers are planning to work together to protect their cell phone businesses from the different national providers like AT&T and Verizon. This is made possible largely by refraining themselves from going after each other.

As per the deal, Charter and Comcast have temporarily agreed not to take any measures or steps that could compromise the new offerings of each other. These actions include trying to buy existing carriers like T-Mobile and Sprint, or selling cell phone services to users outside their corresponding cable footprints.

Experts in the telecommunication industry claim that the deal is essentially aimed at shielding the early investment of the service providers in an industry that they have not tried before. However, this announcement from Charter and Comcast has widespread implications in TV, cell phone, and online media.

Comcast is planning to release their latest cell phone service, Xfinity Mobile soon. Charter said that they would start the sales of their cell phone service beginning next year. Both the companies are promising to offer what you can get on any cell phone service provider today, meaning that you will be able to place calls, use mobile data, and send text messages from mobile phones that are provided by Charter or Comcast. However, behind the scenes, the services of Comcast and Charter will run on a network that is owned by Verizon.

The new services from Charter and Comcast will be starting as a way for both the companies to safeguard and expand their traditional cable offerings, that too at a time when more and more users are ditching cable. For instance, Comcast users will be getting a discount on Xfinity Mobile subscription if they have already subscribed to their Premier Triple Play or Double Play services. In addition, the users will need a Comcast Internet subscription to sign up for Xfinity Mobile services.

“Adding a high-quality product that deepens the [customer] relationship will be a positive churn factor,” Comcast chief financial officer Mike Cavanaugh said last month. “Churn” is an industry term that is used to refer to the number of subscribers who cancel their internet provider and leave.