Comcast Corporation and Charter Communications, the two largest cable companies in the United States, are forming an equal joint venture to develop and offer a next-generation streaming platform on a variety of branded streaming devices and smart televisions. It will offer app developers, streamers, retailers, operators, and hardware manufacturers the opportunity to reach customers in major markets across the United States. Comcast will license Flex, its aggregated streaming platform and hardware to the joint venture, contribute the retail business for XClass TVs and will contribute Xumo, a streaming service it acquired in 2020. Charter will make an initial contribution of $900 million, funded over multiple years.
The XClass TVs will be available through national retail partners and potentially direct from Comcast and Charter to provide more customer choice.
Comcast will continue to offer the Flex streaming platform as a streaming device and service to its customers. Charter will offer the 4K streaming TV devices and voice remotes beginning in 2023.
Xumo will continue to operate as a free global streaming service available through the joint venture’s products and third-party devices.
“These products are all designed to make search and discovery across live, on-demand and streaming video seamless and incredibly simple for consumers,” said Dave Watson, the chief executive of Comcast Cable. “This partnership uniquely brings together more than a decade of technical innovation, national scale and new opportunities to monetize our combined investment.”
Tom Rutledge, the chairman and chief executive of Charter, said “Our new venture will bring a full-featured operating platform, new devices, and smart TVs with a robust app store providing a more streamlined and aggregated experience for the customer. As the video landscape continues to evolve, this venture will increase retail consumer options, compete at scale with established national platforms, and join our existing lineup of options for the Spectrum TV App available on most customer-owned streaming devices.”
The joint venture does not involve the broadband or cable video businesses of either Comcast or Charter.
The joint venture will compete companies like Roku, as well as with Amazon with its Fire brand.
Separately, Comcast and Charter have announced that they are trading some cable subscribers, following completion of the previously announced merger of Comcast and Time Warner Cable.
Charter will acquire approximately 1.4 million existing Time Warner Cable customers, increasing Charter’s current residential and commercial video customer base from 4.4 million to approximately 5.7 million.
Comcast and Charter will transfer assets serving approximately 1.6 million existing Time Warner Cable customers and 1.6 million Charter customers.
Comcast will form and spin off to its shareholders a new, independent listed company that will operate systems serving approximately 2.5 million existing Comcast customers.
It will leave Comcast with just under a 30% share of the multichannel video subscriber market.