Charter 2015 Annual Report Download - page 124

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CHARTER COMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2015, 2014 AND 2013
(dollars in millions, except share or per share data or where indicated)
F- 27
13. Operating Costs and Expenses
Operating costs and expenses consist of the following for the years presented:
Year Ended December 31,
2015 2014 2013
Programming $ 2,678 $ 2,459 $ 2,146
Franchise, regulatory and connectivity 435 428 399
Costs to service customers 1,705 1,679 1,575
Marketing 619 610 557
Transition costs 72 14 —
Other 917 783 668
$ 6,426 $ 5,973 $ 5,345
Programming costs consist primarily of costs paid to programmers for basic, premium, digital, video on demand, and pay-per-
view programming. Franchise, regulatory and connectivity costs represent payments to franchise and regulatory authorities and
costs directly related to providing Internet and voice services. Costs to service customers include costs related to field operations,
network operations and customer care for the Company's residential and small and medium business customers including internal
and third party labor for installations, service and repairs, maintenance, billing and collection, occupancy and vehicle costs.
Marketing costs represents the costs of marketing to our current and potential commercial and residential customers including
labor costs. Transition costs represent incremental costs incurred to increase the scale of the Company's business as a result of the
TWC Transaction, Bright House Transaction and Comcast Transactions. See Notes 3 and 8 for additional information. Other
includes bad debt expense, corporate overhead, advertising sales expenses, costs associated with the Company's enterprise business
customers, property tax and insurance and stock compensation expense, among others.
14. Other Operating Expenses, Net
Other operating expenses, net consist of the following for the years presented:
Year Ended December 31,
2015 2014 2013
Merger and acquisition costs $ 70 $ 38 $ 16
Special charges, net 15 14 23
Loss on sale of assets, net 4 10 8
$89$62$47
Merger and acquisition costs
Merger and acquisition costs represents costs incurred in connection with merger and acquisition transactions, such as advisory,
legal and accounting fees, among others.
Special charges, net
Special charges, net, primarily includes severance charges and net amounts of litigation settlements.
Loss on sale of assets, net
Loss on sale of assets, net, represents the net loss recognized on the sales and disposals of fixed assets and cable systems.