Suddenlink: Then & Now

Redefining Value in an Evolving Industry

Executive Summary

The World Suddenlink Lives In

Research Objectives

AGENDA

Data, Process and Limitations

Part One: Customer Analysis and Opportunities
Part Two: Ecosystem Analysis and Opportunities
Conclusion

The Way Things Were

Content Producers &

Content Providers

SUDDENLINK
(Content Distributors)

Advertisers

Content
Viewers

The World Suddenlink

Lives In Today

Content Producers &

Content Providers

SUDDENLINK
(Content Distributors)

Advertisers

Content
Viewers

RESEARCH
OBJECTIVES

Redefine and Create Value

How are changes in consumer behavior affecting
their value to Suddenlink?
How can Suddenlink leverage these insights to
maximize customer value?

Shift Power Dynamics

How can Suddenlink leverage its customer-level
data to strengthen its position with content
providers at the negotiating table?

Data, Method &

Limitations

Are We Facing the

End of TV As We Know It?

Busting the
Cord Cutting Myth

Suddenlink: Cord Cutters Are Not an Issue

3%

of Suddenlink Customers
are Cord Cutters (as of Dec 2015)

Industry Average: 1%-10%

Finding Long Term Opportunities

in a World of Chaos

Redefining Value

Household Adds Customer Lifetime Value

Segments as Percentage of Customer Base

Segments as Percentage of Customer Base

Compared to LTV per customer

LTV Among All Customers:

$2,070

VIDEO
UPGRADERS

Video Upgraders:

Most Valuable Segment

Video Upgraders
have Families

They are likely to be families with children

36% vs. 32%

70% of them are Triple-Players

More services = Less likely to leave

Their content preferences are different

Unique Top Shows include Jessie, Mickey Mouse Club, and Chopped

Increase LTV by:

Maintaining and Expanding

Appreciate your MVPs:

Flag them as MVP as soon as they upgrade
Offer Home Security (65% are home-owners)
Impact: increase LTV by $45 - $90 per customer

Expand this segment:

By identifying and acquiring Lookalikes
Impact: increase segment LTV by $58K - $116K

Opportunity:
Video Upgraders

Increasing LTV by
$45-$90
per Video Upgrader

Increasing Total LTV by

$1.2 M - $2.4 M
for all Video Upgraders

CORD
SHAVERS

Cord Shaving is
on the Rise
WHY SHAVE THE CORD?

Belief: Skinny Bundles can save money

Stream some content via OTT service

Keep TV to watch Talk shows, News and Live Sports

Cord Shavers:
Profitable and Sticky

Increase LTV by:

Upselling HSD

Why:

More data than average

More data after shaving

110GB per month

(vs. 106GB per month)

119GB per month

(vs. 102GB per month)

How:
1.

Add HSD
Impact: increase LTV by $8 - $17 per customer

2.

Upgrade HSD
Impact: increase LTV by $69 - $138 per customer

Opportunity:
Cord Shavers

Increasing LTV by
$77-$154
per Cord Shaver

Increasing Total LTV by

$2.1 M - $4.2 M
for all Cord Shavers

CORD
NEVERS

Cord Nevers Represent

the Future
Customers who have never subscribed
to Pay TV but have Data

Most likely to be millennials (Under 32)

Happy with OTT service

Satisfied with broadcast TV

No Cable = Save Money

Low interest in watching live TV

Cord Nevers are

Increasing
They are different from SLs

Potential Cord Nevers:

50% of SLs New Customers!
Who are they: customers who joined in
2015 with a starting bundle of Data only
or Data and Phone

customer base demographically

Cord Nevers:
Growing Opportunity

Increase LTV by:

Upgrading HSD
Encourage Cord Nevers to
Upgrade their HSD Plans
Impact: Incremental LTV of
$98 - $169 per customer

Data usage: increase 37% in 2015

Increase LTV by:

Retaining

Offering Flexible Plans: Improve Retention Rate

E.g. Moving Plan or College Student Plan

Impact: Incremental LTV of $292 per customer

Increase Future LTV by:

Understanding and Adapting

Long-Term Study:
Cord Nevers may upgrade when they reach Full Nest life stage.
Study the relationship between life stage and video consumption.
Create consumer migration plan across their lifetime.

Opportunity:
Cord Nevers

Increasing LTV by
$408-$491
per Cord Never

Increasing Total LTV by

$163.6 M - $197.0 M
for all Cord Nevers

Combined Impact
on Total LTV

Total Impact: Increase of $167 - $204 Million

LTV Among All Customers:

$2,070

Recommendation
Timeline
Short Term

Long Term

1. UPSELL:

1. FOCUS ON RETENTION:

Convince Cord Shavers and Cord Nevers to Upgrade their

current HSD packages

Increase retention rate of Cord Nevers by 0.5%

2. CROSS SELL:
Cross Sell HSD to Cord Shavers without Data
Cross Sell Home Security to Video Upgraders to further
increase their stickiness

3. TEST AND LEARN:

Conduct market test to optimize additional service offerings

2. FURTHER STUDY:
Relationship between life stage and video consumption
to understand service migration in the long run.

Ecosystem Opportunities
How Suddenlink Can Expand Its Role

The Bigger Picture

Content Producers &

Content Providers

SUDDENLINK
(Content Distributors)

Advertisers

Content
Viewers

Suddenlinks New Roles

Matchmaker

Tailor

Fortune
Teller

Suddenlink as
Matchmaker
What shows are watched together?
Optimized advertising opportunities
Content & Commercials

Viewers who watch Austin & Ally are 3.5x more likely than
other viewers to watch Dog With a Blog and 3.4x more likely
to watch Girl Meets World.

Recommendations

Characters cross-over

Advertise shows during other shows

Air new episodes back-to-back

Viewers who watch 2 Broke Girls are

1.3x more likely than other viewers to
watch College Football.

Recommendations

College Football themed

episode

Advertise CBS-aired
football games during 2
Broke Girls episodes
(and vice versa)

Football-themed
advertisements during 2
Broke Girls episodes

Viewers who watch Late Night with Seth Meyers are

4x more likely than other viewers to watch Last Call
with Carson Daly.

Strong loyalty to network channels for news & talk

Focus advertising spend on leading show

Suddenlink as Matchmaker

Targeted advertising is coming to television

Match advertising to content

Content
Distributors

Content Producers &

Content Providers

Advertisers

Suddenlink
as Tailor
Consumers demand customization
Suddenlink can identify optimal channel
bundles

Suddenlink as Tailor

Suddenlink Skinny Sports Bundle

Network Channels + Sports

23 of Most Popular Shows

5 of Most Popular Shows

Suddenlink as Tailor

26%

of viewing occasions were

watching recorded shows

Cable and OTT bundling

All-OTT bundling opportunities

Suddenlink as
Fortune Teller
Predicting a shows success
Identifying a niche audience

Suddenlink as
Fortune Teller

Episode One

Customer viewing
behavior
Number of viewers
Nielsen rating
Social media

Episode Two

Viewer return rate

Change in number
of viewers
Nielsen rating
Social media

Episode Thirteen

Viewer return rate

Change in number
of viewers
Nielsen rating
Social media

Suddenlink as
Fortune Teller
Renewed Shows

Viewership

Canceled Shows

Episode Count

The numbers just didnt sustain the cost of the show,

quite frankly. Its all math at the end of the day. We
couldnt establish that core audience that allows you
to figure out your advertising paradigm and whether or
not the show is affordable.
Series creator and showrunner Kurt Sutter, The Bastard Executioner

Conclusion
The data you have is important.

Redefine value metrics and focus on

customer lifetime value
Leverage consumer behavior to
explore untapped opportunities
Assume new roles as matchmaker,
tailor and fortune teller
Earn greater leverage and negotiating
strength

APPENDIX

Definition of Each Segment

CORD CUTTERS: Customers who stopped having VIDEO at some point
CORD SHAVERS: Customers who either downgraded from Expanded Basic to
Basic or from Premium to Expanded Basic
CORD NEVERS: Customers who never had VIDEO and started with DATA only
or DATA+PHONE bundles
VIDEO UPGRADERS: Customers who either upgraded from Basic to Expanded
Basic or from Expanded Basic to Premium

Suddenlink
Customer
Base Snapshot
(Dec15)
Suddenlink
Customer
Base Snapshot

(Dec15)

Suddenlink
Base
Snapshot (Dec15)
SummaryCustomer
Table of
Segment
Statistics

SL gained new customers at about the same rate it lost them

(Net down for year)

Potential Cord Nevers Joining Each Month

Cord Cutter Statistics

Some Characteristics of SLs Cord Cutters

98% at least have a Basic plan (vs 61% all)

99.75% have HSD vs 80% all
51% DO NOT have DVR (vs 25% all)
86% have HDTV (vs 47% all)
87% had Video on Demand-enabled (vs 50% all)
89% had the Expanded Basic plan (vs 56% all)

Households with OTT Subscriptions -> More Likely to Cut

Financials:
Video Upgraders Home Security

VIDEO
UPGRADERS

25739

Without investment

Pessimistic

Optimistic

Percentages

Home security

$10,295.60

$25,739.00

$51,478.00

SUM

$10,295.60

$25,739.00

$51,478.00

$0.40

$1.00

$2.00

$0.32

$0.80

$1.60

$44.95

$89.89

$1,156,968.05

$2,313,678.71

NLTV

2.00%

5.00%

10.00%

Financials:
Video Upgraders
Home Security and Expand
VIDEO
UPGRADERS

27025

Without
investment

Pessimistic

Optimistic

Home security

$10,810.00

$27,025.00

$54,050.00

SUM

$10,810.00

$27,025.00

$54,050.00

$0.40

$1.00

$2.00

$0.32

$0.80

$1.60

$44.95

$89.89

$1,214,773.75

$2,429,277.25

1156968.05

2313678

$57,805.70

$115,599.25

NLTV

Percentages
2.00%

5.00%

10.00%

Financials:
Cord Shavers

CORD
SHAVERS

26924

Without investment

Pessimistic

Optimistic

Percentages

Add HSD

$2,028.60

$5,071.50

$10,143.00

2.00%

5.00%

10.00%

Upgrade HSD

$16,314.54

$40,786.35

$81,572.70

2.00%

5.00%

10.00%

Home security

$10,769.60

$26,924.00

$53,848.00

2.00%

5.00%

10.00%

SUM

$29,112.74

$72,781.85

$145,563.70

$1.08

$2.70

$5.41

$1.05

$2.62

$5.24

$122.90

$245.80

$3,308,959.60

$6,617,919.20

NLTV

Financials:
Cord Nevers
CORD NEVERS

401255
Without investment

Upgrade HSD

NLTV
.5% INCREASE
IN RETENTION
RATE%

Pessimistic

Optimistic

Percentages

$754,359.40

$1,320,128.95

$2,263,078.20

$1.88

$3.29

$5.64

$1.82

$3.19

$5.47

$98.50

4.00%

7.00%

$169.00

$39,523,617.50

$67,812,095.00

$407.84

$490.98

$853.40

$954.90

$39,523,617.50

$67,812,095.00

$163,647,839.20 $197,008,179.90

12.00%

Market Basket Analysis: Show Pairings

Predictor

Channel

Genre

Result

Channel_Result Genre_Result

Support

Confidence

Lift

CBS Overnight News

CBS

News

CBS Morning News

CBS

News

0.1009487

0.8773784

4.2939318

Last Call With Carson Daly

NBC

Talk

Late Night With Seth Meyers

NBC

Talk

0.1369496

0.7701778

3.9429652

Late Night With Seth Meyers

NBC

Talk

Last Call With Carson Daly

NBC

Talk

0.1369496

0.7011208

3.9429652

CBS Morning News

CBS

News

CBS This Morning

CBS

Talk

0.1009487

0.8201581

3.5754719

Austin & Ally

Disney

Children

Dog With a Blog

Disney

Children

0.1143274

0.5860349

3.4966466

Dog With a Blog

Disney

Children

Austin & Ally

Disney

Children

0.1143274

0.682148

3.4966466

Austin & Ally

Disney

Children

Girl Meets World

Disney

Sitcom

0.1084894

0.5561097

3.4224058

Girl Meets World

Disney

Sitcom

Austin & Ally

Disney

Children

0.1084894

0.6676647

3.4224058

CBS Morning News

CBS

News

CBS Overnight News

CBS

News

0.1009487

0.6525157

3.348929

CBS Morning News

CBS

News

CBS This Morning

CBS

Talk

0.1547069

0.7571429

3.3007575

CBS This Morning

CBS

Talk

CBS Morning News

CBS

News

0.1547069

0.6744433

3.3007575

CBS Morning News

CBS

News

CBS Overnight News

CBS

News

0.1230844

0.602381

3.0916206

CBS Overnight News

CBS

News

CBS Morning News

CBS

News

0.1230844

0.6317104

3.0916206

ABC World News Now

ABC

News

America This Morning

ABC

News

0.1656531

0.574199

2.8101572

America This Morning

ABC

News

ABC World News Now

ABC

News

0.1656531

0.8107143

2.8101572

College Football

Sports event

CBS Morning News

CBS

News

0.1053272

0.2738773

1.3403685

0.1087327

0.3768971

1.3380174

ABC World News Now

ABC

News

Dateline NBC

NBC

Newsmagazine

Dateline NBC

NBC

Newsmagazine

ABC World News Now

ABC

News

0.1087327

0.3860104

1.3380174

2 Broke Girls

CBS

Sitcom

College Football

Sports event

0.1080029

0.5127021

1.3331551

College Football

Sports event

2 Broke Girls

CBS

Sitcom

0.1080029

0.2808349

1.3331551

Anger Management

Fox

Comedy

College Football

Sports event

0.1045974

0.510083

1.3263449

College Football

ESPN

Sports event

Anger Management

Fox

Comedy

0.1045974

0.2719798

1.3263449

Most Popular Shows

Rank

Show Title

Hours
Watched

Channel

Rank

Show Title

Hours
Watched

Channel

SportsCenter

33,617

ESPN

16

ABC World News Now

7,728

ABC

Paid Programming

29,657

17

The Kelly File

7,345

FOX

Today

23,011

NBC

18

The Big Bang Theory

7,302

CBS

College Football

19,516

Varies

19

General Hospital

7,156

ABC

NFL Football

15,738

Varies

20

MLB Baseball

7,117

Varies

Law & Order: Special Victims Unit

11,079

NBC

21

Days of our Lives

7,053

NBC

Dr. Phil

10,882

CBS

22

Jimmy Kimmel Live

6,838

ABC

Late Night With Seth Meyers

9,759

NBC

23

Law & Order

6,617

NBC

The Late Late Show With James Corden

9,268

CBS

24

Teen Titans Go!

6,607

Cartoon
Network

10

NCIS

9,217

CBS

25

FOX and Friends

6,492

FOX

11

The O'Reilly Factor

8,833

FOX

26

Hannity

6,346

FOX

12

The Voice

8,324

NBC

27

Judge Judy

5,954

CBS

13

Good Morning America

8,130

ABC

28

The Ellen DeGeneres Show

5,836

NBC

14

The Tonight Show Starring Jimmy Fallon

8,130

NBC

29

Criminal Minds

5,832

CBS

15

The Young and the Restless

7,831

CBS

30

NBA Basketball

5,763

Varies

Variables for new show success prediction

Fraction of return: The number of viewers who watched the last episode and also watched the
current episode
Change in viewers: The difference between the amount of viewers for the last episode and the
amount of viewers for the current episode
Average completion: The percent of the episode a viewer watched, averaged across all viewers
Playback_difference: The difference between the date a viewer watches the show and the date the
show is on air
Fraction of population: The percent of all viewers who watch the episode
Cancel_flag: If the show has been canceled, value it as 1. Otherwise, value it as 0.