Charter Communications, Inc. CHTR

The business

Charter is the coaxial cable running down a street in one of 41 states, and the 31.5 million households and businesses attached to it. Internet is the product that matters: 29.4 million customers paying about $118 a month for a connection they cannot easily replace, because the alternative is a fibre build that nobody has funded on their street or a wireless connection that is worse when it rains.

Video is in managed decline and everyone accepts it. Mobile is the growth line, resold over Verizon's network and bundled to make the internet bill stickier, at 12.5 million lines and adding roughly 400,000 a quarter. The economics are simple and brutal: enormous fixed plant, high incremental margin, and a permanent capital spending bill to keep the plant competitive.