Charter Communications reshapes video landscape with Warner Bros. Discovery deal
A new era for Spectrum TV
Charter Communications, now the leading cable TV operator in the U.S., is making significant strides in adapting its video services for the streaming age. In a groundbreaking move, Spectrum TV Select customers will soon enjoy access to the Max streaming service at no extra charge. This development comes as part of an early deal renewal with Warner Bros. Discovery (WBD).
Early renewal and expanded offerings
The new agreement, reached nearly a year ahead of schedule, bundles the ad-supported version of Max, which includes all HBO and Max content, as well as Discovery+, with all Spectrum TV Select packages. This means subscribers will have access to a vast library of premium content without any additional fees.
While the financial details of the deal remain undisclosed, both WBD and Charter have emphasized that this new arrangement is mutually beneficial. As of the end of June, Charter had 12.72 million residential video subscribers, a decline of 393,000 during the period and a 9.6% drop year over year. Including business pay-TV customers, Charter’s video base stood at 13.3 million as of June 30.
Expanding the streaming bundle
The inclusion of Max and Discovery+ follows similar deals Charter has made with other major streaming services. Previously, Charter inked agreements to bundle Disney+ and ESPN+ with Disney, and Paramount+ and BET+ with Paramount Global. Additionally, AMC+ and Vix have also been added to the Spectrum TV lineup.
It’s important to note that while these streaming services are being bundled with Spectrum TV, they are not exactly “free.” Charter has incorporated the cost into the overall price of the service. For instance, in July, Charter increased the prices of Spectrum TV Select by $3 per month in certain regions.
Industry dynamics and competitive landscape
The renewal of the WBD-Charter deal comes at a time when the industry is experiencing significant shifts. For example, DirecTV has been in a prolonged blackout of Disney’s channels, including ESPN and ABC, after failing to renew their carriage contract. In contrast, Charter successfully renewed its deal with Disney on September 11, 2023, following a 12-day blackout. Under this agreement, Disney networks such as Freeform were dropped from Spectrum TV, but Charter secured rights to bundle Disney+ and ESPN+ with its cable TV packages.
Strategic partnership and future plans
WBD CEO David Zaslav highlighted the importance of this partnership, stating, “This innovative partnership with Charter recognizes the value of our linear content and the investments we’ve made in premium original programming, sports, and news. It also significantly expands the distribution of Max’s ad-supported service to Spectrum’s millions of Select customers.”
Charter CEO Chris Winfrey echoed these sentiments, noting, “This strategic relationship with WBD further evolves the linear and broadband video distribution model. It supports Spectrum’s efforts to provide flexible packages, whether through hybrid linear-direct-to-consumer full video relationships, smaller video packages with DTC add-ons, or a suite of a-la-carte or bundled DTC options for broadband customers.”
Enhanced content and marketing opportunities
The long-term agreement also extends Spectrum’s carriage of WBD’s linear network portfolio, including popular channels like TNT, CNN, Food Network, HGTV, TLC, Discovery, TBS, Adult Swim, and Investigation Discovery. Additionally, the deal establishes Max as a “preferred partner” for Spectrum when marketing and selling direct-to-consumer apps and bundles to broadband subscribers. This creates a significant opportunity to reach Charter’s full video and broadband customer base.
Looking ahead: Deployment and distribution
Spectrum plans a “full deployment” of its direct-to-consumer (DTC) distribution to broadband customers in 2025, following the 2024 deployment of its streaming inclusion and upgrade offers. This plan will include separate pricing, packaging, and billing capabilities for streaming video services offered to broadband customers.
For those eager to explore the content available through these new bundles, check out the trailers for some of the most popular shows and movies on Max and Discovery+:
This strategic move by Charter Communications and Warner Bros. Discovery marks a significant shift in the video distribution landscape, offering consumers more value and flexibility in their entertainment choices.