WideOpenWest, Inc. (NYSE:WOW) Q3 2023 Earnings Call Transcript

Frank Louthan: Okay. And then just a follow-up. Are you calling — are you going to force off your pay-TV subscribers? And what percentage of them take high-speed data? And are you really — are you calling for the end of your Pay TV product?

Teresa Elder: Yes. Let me talk about our video migration. So we definitely are encouraging customers to take our traditional video to either subscribe to YouTube TV or a streaming service. And so we do let them know that, that is an option that is coming. We have not forced customers off of video to date. And we are really trying to manage churn on that to continue to support that. With that said, we know that over the next year, 1.5 years, we want to completely get off of our QAM network. So at some point, there will be that. That’s not what we’re doing is forcing them off right now. And in terms of the percentage of video customers who also take high-speed data, I mean, it’s virtually all of them, we have very — a small handful of customers that only take video or video and phone. So it is — you can pretty much assume that almost all of them take high-speed data.

Frank Louthan: Okay. Thank you.

Operator: Your next question comes from the line of Brandon Nispel from KeyBanc Capital Markets. Your line is live.

Brandon Nispel: Hey thanks for taking the question. Teresa, so I heard you say, I think losses for Internet net additions in 4Q could be nearly triple what they were this quarter. But I’m hoping you could address maybe what you’re doing specifically in the legacy footprint to get losses or at least mitigate the losses going forward? And then I was hoping you could maybe outline a little bit what were wrong internally versus plan on some of the expansion, it sounded as this last quarter, that was tracking at least in line, if not better than your expectation. So it sounds like something maybe within the quarter. So I was hoping you could elaborate. Thanks.

Teresa Elder: Yes. Thanks for the questions, Brandon. In terms of mitigating the losses, we are doing a lot there. I mean, for one thing, we don’t have a rate increase this quarter. The rate increase in July behaved differently than previous rate increases we’ve taken. And just, I guess, a little bit of the inside baseball on that is that I think we hadn’t done a rate increase like this in the summer before. When we were doing our results last quarter, we thought things were looking pretty good. It didn’t look like — effect, if anything, it looked like churn was lower than we had even anticipated in forecast. I think what we found is that customers started to look at their bills and maybe ask questions about the rate increase later in September, so much later than what you would have normally seen in terms of a reaction to a rate increase.

Perhaps that’s with summer vacations or once the kids got back in school, they started actually looking at their bills more, it’s hard to say. But it behaved a little differently. And so we were caught a bit off guard because we thought it was coming in as anticipated, and it actually had been higher churn than we forecast later than we forecast. So we were a bit surprised by that. So one of the things we’re not doing in the fourth quarter is a rate increase. However, we do have a substantial number of promo roll-offs that has happened in the third quarter and even some going into the fourth quarter. And that’s from promotions we did last year at this time, kind of have a 12-month thing. It’s part of the phenomena of the competitiveness of the packages that we offer in this environment.