Charter 2003 Annual Report Download - page 4

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MARKET ADVANTAGE
With approximately 6.2 million analog video customers and 10.5 million revenue generating units, Charter’s new senior
management team is focused on driving revenue, maximizing operating leverage and protecting our core businesses.
Operations: We’ve delivered on our pledge to improve the efficiency and skill levels at work within our customer service
infrastructure. We’ve consolidated our customer call centers to 37 from more than 153, and now serve more than 90 percent
of our customer base from just 14 call centers. With a well trained service staff we can deliver a consistently positive
experience across our Company, and across all of our new service offerings. We’ve also essentially completed our billing system
conversions, converting over 3 million customers in 2003, ensuring that the integrated billing and account management
platform better supports all services across our footprint.
Products: We continue to see momentum in our high-speed Internet product category, adding 427,500 new customers in
2003, and increasing revenues by 65 percent. We’ve migrated our high-speed Internet customer provisioning approach to a
uniform platform across the Company, offering a primary connection speed of three MBs downstream. We’ve injected more
value into our digital cable service by adding new high definition (HD) TV programming, including HD programs from local
broadcast stations — a highly prized feature our satellite competitors have difficulty delivering — as well as cable
programming including movies and sports. Late in 2003, we introduced digital video recorder (DVR) capabilities and, thus
far, we are pleased with customer take rates of this exciting new product. At the same time, our video and subscription video
on-demand TV offerings (VOD and SVOD) are growing in availability and popularity. More than 920,000 digital customers
can select on-demand TV programs and movies, or enjoy monthly subscriptions for on-demand programming. Overall, the
competitive position of our digital cable service continues to improve.
Our vision of the digital platform came to life in early 2004 when we introduced the first all-digital cable telecommunications
network in Long Beach, California, resulting in widespread industry attention. Converting from analog to digital improves picture
quality and recovers precious service carrying capacity that can be used to provide more high definition television as well as
targeted services including VOD and specialized subscription services. We expect to launch similar efforts in more of our markets.
Finally, we offer voice-over-Internet protocol (VoIP) telephone service in two markets, and we’re working hard to lay
the groundwork for similar deployments in at least one additional market this year, and more markets in 2005 and beyond.
Telephone service over cable is capturing strong interest and better than expected penetration levels as compared to our industry
peer group. We look forward to a significant business contribution beginning in 2005.
We believe the revenue opportunities and the differentiation of services of VoIP, VOD, SVOD, HDTV, DVR, home networking
and advanced set-top deployments will be similar to the great success the cable operators have enjoyed with high-speed
Internet services. Charter is at the early stage of tapping into this potential and we believe our operational improvements
over the last year position us well to grow.
Marketing: We compete aggressively in the marketplace by effectively pricing and communicating our advantages to today’s
discerning consumer. Out network does more, and we’re letting the world know it. Our 2004 marketing promotions revolve
around the campaign “Get Hooked”. In an aggressive and entertaining way, this message drives forth the fact that we deliver
differentiated services we believe our competitors simply can’t match. We’ve also repriced key services to compete more
effectively, and to send a more consistent message about our offerings across our Company. As a result of these and other
improvements, our customers are experiencing greater satisfaction with the level of service they receive.
02.
INTRODUCING NEW DIGITAL
FEATURES INCLUDING HDTV AND DVR