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    Latinas contributed $1.3 trillion to U.S. economy, new report says. That number could be even bigger

    Latinas contributed $1.3 trillion to 2021 U.S. gross domestic product, up from $661 billion in 2010, according to a recent report funded by Bank of America.
    The economic output of Latinas was more than Florida’s economy that year, with only the GDP of California, Texas and New York being larger.
    Still, some economists believe that Latinas’ total contribution to the country’s GDP could actually be more than what’s being reflected in the data.

    Miami Beach, Florida, Manolo, restaurant, employees at bakery counter. (Photo by: Jeffrey Greenberg/Universal Images Group via Getty Images)
    Jeff Greenberg | Universal Images Group | Getty Images

    Latinas are making substantial contributions to the U.S. economy.
    The female Hispanic population contributed $1.3 trillion to gross domestic product in 2021, an increase from $661 billion in 2010, according to a recent report funded by Bank of America.

    That marks a real GDP growth rate of 51.1% between 2010 and 2021, meaning an economic contribution that’s 2.7 times that of the non-Hispanic population.
    The total output of U.S. Latinas in 2021 was also larger than the entire state of Florida that year, the report noted, citing data from the Bureau of Economic Analysis. In fact, only those from California, Texas and New York, respectively, were larger that year.

    Despite those large figures, some economists think that U.S. Latinas could be contributing more to GDP than the report’s figure.
    Belinda Román, an associate economics professor at St. Mary’s University, said that there’s activity in various areas that the data may not be capturing. Child care is one of those.
    “A lot of that is uncompensated care,” she said in an interview with CNBC. “Interestingly, there are a lot of Latinas in that space that you’re not going to see in these numbers, so I think to some extent it may not be big enough actually.”

    Economist Mónica García-Pérez also believes the figure could be bigger, saying that some of Latinas’ “unmeasured” contributions — such as being a stay-at-home mom that’s providing care for other neighbors’ kids, for example — allow “other groups to participate in the labor market.”
    She also pointed to the occupational positions they hold more generally as posing some difficulty when assessing their contributions.
    “This group is very sensitive to shocks, and it could be related to their presence in sectors where there’s a lot of mobility or turnover,” the Fayetteville State University economics professor said. She added that they tend to be concentrated in care and service industries, such as health care, retail and hospitality. This is what makes them a “moving piece” in economic cycles.
    In the case of a recession, for instance, García-Pérez said Latinas are “likely to lose their job much faster being in the sectors they’re in,” as seen during the Covid-19 pandemic. “But they also may be more likely to be reincorporated in the market because the cost of entry and the type of positions they enter at have lower barriers.”

    A growing force

    When it comes to labor force participation, Latinas are outpacing other groups, the BofA report showed.
    From 2000 to 2021, the participation rate for Latinas rose 7.5 percentage points. On the other hand, the participation rate of the non-Hispanic women in the same period was flat.
    The group has also been more resilient than others. Although labor force growth slowed overall in 2020, the growth rates for Hispanic men and women were still positive. Conversely, the non-Latino labor force growth rate was negative that year, meaning that more people left the labor force than entered it.
    Beyond that, Latina GDP grew more than five times the rate of non-Latino GDP between 2019 and 2021, gaining 7.7% compared to 1.5%. Meanwhile, the GDP of Hispanic men grew nearly four times the rate of non-Latino GDP in those years at 5.9%.
    These contributions are notable given that Latino households were some of the hardest hit by the pandemic.
    “When the economy broadly is most in need, that’s actually when we see the most dramatic contributions of U.S. Latinas,” said economist Matthew Fienup, the report’s co-author and executive director of the Center for Economic Research and Forecasting at California Lutheran University. “Whereas all Latinos are a source of economic strength, Latinas are drivers of vitality that the economy needs.”
    “If Covid-19 couldn’t stop this growth, it’s hard to see what would,” said David Hayes-Bautista, report co-author and director of the Center for the Study of Latino Health and Culture at the School of Medicine at UCLA.

    Drivers of change

    Since the late 1970s, the share of Latinas with a job has grown. Specifically, the employment-to-population ratio for the group has surged from 41.6% in December 1978 to 56% in December 2023, per data from the Economic Policy Institute.
    By comparison, the ratio for Black women — who alongside Latinas experience the most severe wage gaps relative to white, non-Hispanic men — has advanced 11.9 percentage points. The metric for women overall has climbed by 8.8 percentage points in that period.
    “Some of this is an expansion of opportunities for women,” said Elise Gould, a senior economist at EPI. Part of this is also due to a lack of wage growth for typical workers over the past few decades, she said. “Because it can be hard to get ahead, households may have had to put in more work hours to do better.”
    That seems to be paying off to some extent. The growth in labor force participation as well as a rise in educational attainment are resulting in income gains for the group, notably about 2.5 times that of non-Hispanic women from 2010 to 2021, the BofA’s report co-authors found.

    Brooklyn Puerto Rico Day Parade on June 13, 2021 on Knickerbocker Avenue in the Bushwick neighborhood of Brooklyn, New York.
    Andrew Lichtenstein | Corbis News | Getty Images

    Hayes-Bautista also cited intergenerational shifts and Hispanic women’s more rapid population growth over the Hispanic male and non-Latino populations as another catalyst of Latinas’ economic output.
    “What we started to see in about the year 2000 is that the immigrant first-generation started to age out of the labor force,” he said. “As they age out, their shoes are being filled by their daughters and granddaughters, who are twice as numerous in terms of population size, and they’re bringing much higher levels of human capital.”
    Latinas have especially bolstered the contributions of Latinos as a whole. Fienup told CNBC that Latinos’ total contributions have pushed labor force growth positive in certain regions across the country at times when the non-Latino labor force was contracting.
    “We expect that dynamic to be increasingly important over the next three decades,” he said. “What we’re seeing now is really just the beginning of what will be an increasingly important story in the United States economy.” More

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    FDIC unveils rule forcing banks to keep fintech customer data in aftermath of Synapse debacle

    The Federal Deposit Insurance Corp. on Tuesday proposed a new rule forcing banks to keep more detailed records for customers of fintech apps after the failure of tech firm Synapse resulted in thousands of Americans being locked out of their accounts.
    The rule, aimed at accounts opened by fintech firms that partner with banks, would make the institution maintain records of who owns the account and the daily balances attributed to the owner, according to an FDIC memo.
    Fintech apps often use a type of account where many customers’ funds are pooled into a single large account, relying on either the fintech or a third party to maintain ledgers of transactions and ownership.

    Tsingha25 | Istock | Getty Images

    The Federal Deposit Insurance Corp. on Tuesday proposed a new rule forcing banks to keep detailed records for customers of fintech apps after the failure of tech firm Synapse resulted in thousands of Americans being locked out of their accounts.
    The rule, aimed at accounts opened by fintech firms that partner with banks, would make the institution maintain records of who owns it and the daily balances attributed to the owner, according to an FDIC memo.

    Fintech apps often lean on a practice where many customers’ funds are pooled into a single large account at a bank, which relies on either the fintech or a third party to maintain ledgers of transactions and ownership.
    That situation exposed customers to the risk that the nonbanks involved would keep shoddy or incomplete records, making it hard to determine who to pay out in the event of a failure. That’s what happened in the Synapse collapse, which impacted more than 100,000 users of fintech apps including Yotta and Juno. Customers with funds in these “for benefit of” accounts have been unable to access their money since May.
    “In many cases, it was advertised that the funds were FDIC-insured, and consumers may have believed that their funds would remain safe and accessible due to representations made regarding placement of those funds in” FDIC-member banks, the regulator said in its memo.
    Keeping better records would allow the FDIC to quickly pay depositors in the event of a bank failure by helping to satisfy conditions needed for “pass-through insurance,” FDIC officials said Tuesday in a briefing.
    While FDIC insurance doesn’t get paid out in the event the fintech provider fails, like in the Synapse situation, enhanced records would help a bankruptcy court determine who is owed what, the officials added.

    If approved by the FDIC board of governors in a vote Tuesday, the rule will get published in the Federal Register for a 60-day comment period.
    Separately, the FDIC also released a statement on its policy on bank mergers, which would heighten scrutiny of the impacts of consolidation, especially for deals creating banks with more than $100 billion in assets.
    Bank mergers slowed under the Biden administration, drawing criticism from industry analysts who say that consolidation would create more robust competitors for the likes of megabanks including JPMorgan Chase.

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    SpaceX Starlink has 2,500 airplanes under contract after United megadeal, director says

    SpaceX nearly doubled its backlog of Starlink in-flight Wi-Fi orders with last week’s United Airlines deal, a company director said Tuesday.
    Last week, United announced it would retrofit more than 1,000 planes with Starlink and offer Wi-Fi for free.
    Starlink is steadily expanding into the in-flight Wi-Fi market, with previous deals including Hawaiian Airlines and Qatar Airways.

    A Starlink terminal installed on a Hawaiian Airlines aircraft.
    Hawaiian Airlines

    PARIS — SpaceX nearly doubled its backlog of Starlink in-flight Wi-Fi orders with last week’s United Airlines deal, a company director said Tuesday.
    “Very excited that we have about 2,500 aircraft under contract now, bringing what was effectively a startup to now what we think is a growing experience that’s going to resonate with all the passengers and the airlines worldwide,” Nick Galano, SpaceX director of Starlink aviation sales and partnerships, said during a panel at the World Space Business Week conference in Paris.

    The satellite internet arm of Elon Musk’s space company is pushing into the in-flight connectivity, or IFC, market. Last week, United said it will outfit its more than 1,000 planes with Starlink and won’t charge customers for the Wi-Fi.

    Read more CNBC space news

    The United megadeal was Starlink’s largest IFC agreement yet. It will also push out United’s existing quartet of WiFi providers — Viasat, Panasonic, Thales and Gogo — as Starlink is installed on the airline’s planes in the next several years.
    SpaceX has previously announced in-flight deals and has started service with Hawaiian Airlines, Qatar Airways, Japan’s Zipair, Latvia’s airBaltic and semi-private charter airline JSX.
    SpaceX has steadily expanded its Starlink network and product offerings since its debut in 2020. The company initially targeted consumers, but has expanded into other markets, including enterprise services such as aviation and maritime.
    There are currently about 6,400 Starlink satellites in orbit that connect more than 3 million customers in 100 countries, according to the company.

    Galano touted “the sheer factor of the capacity that we can provide” via Starlink, saying the current satellite constellation is “probably over 100 times what all the legacy systems have provided” due to “over 300 terabits per second worth of capacity today.”
    SpaceX continues to increase that capacity as well, launching rockets carrying new Starlink satellites about every three days on average this year, according to the company.

    Nick Galano, SpaceX director of Starlink Aviation Sales and Partnerships, center, speaks at the World Space Business Week conference in Paris on Sept. 17, 2024.
    CNBC | Michael Sheetz

    Galano also emphasized that SpaceX is trying to reduce the time it takes to install new antennas on aircraft. Known as retrofitting, the process is a pain point for airlines that requires taking aircraft out of active service for days at a time in order to upgrade or replace a satellite communications system.
    “We’re trying to simplify those installations — innovation is a word we use — to get them done in under a day, which we’ve proven on Hawaiian’s and JSX’s fleets,” Galano said.

    By comparison, Delta Air Lines said its satellite IFC retrofits take “on average about three days,” according to Glenn Latta, the airline’s managing director of in-flight entertainment and connectivity. But Latta said Delta’s process, which requires retrofitting 1,200 aircraft, is also more intensive compared with Starlink’s installation on Hawaiian’s fleet, which stood at 66 aircraft in mid-2024, according to a securities filing.
    “A retrofit for us is removing the system that’s there … and then you can do your install,” Latta told CNBC after the conference panel. “[Hawaiian] have never had a satcom system, so that’s one of the differences to take into account.”
    Delta, which relies on Viasat for in-flight service, said in early 2023 it would make its Wi-Fi free to members of its frequent flyer program — a decision that Latta says has proven to be well worth it to the airline. Both Delta and United are in a battle for high-end customers.
    “We’ve gotten 3 million additional SkyMiles members as part of our loyalty program by offering free internet access,” Latta said.
    — CNBC’s Leslie Josephs contributed to this article.

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    UAW union files unfair labor charges against Stellantis, accuses automaker of violating contract

    The United Auto Workers union on Monday said it had filed federal unfair labor practice charges against Stellantis.
    The UAW alleged the automaker had violated contract terms and is attempting to move production of the Dodge Durango out of the U.S.
    The charges are the latest action by the union against Stellantis, which has drawn the ire of UAW leaders for production cuts, layoffs and other actions.

    United Automobile Workers (UAW) President Shawn Fain speaks on the first day of the Democratic National Convention (DNC) at the United Center in Chicago, Illinois, on August 19, 2024. 
    Mandel Ngan | AFP | Getty Images

    DETROIT — The United Auto Workers union on Monday said it had filed federal unfair labor practice charges against Stellantis for allegedly violating contract terms and attempting to move production of the Dodge Durango out of the U.S.
    The charges are the latest action the union has taken against Stellantis, which has drawn the ire of UAW leaders for production cuts, layoffs and other actions since the two sides reached a new contract last year.

    “In our 2023 contract, we won major gains, including a commitment to reopen an idled assembly plant in Belvidere, Illinois, and to build the Dodge Durango in Detroit. We also won the right to strike over those commitments, if we have to,” UAW President Shawn Fain said in a statement. “Now, Stellantis wants to go back on the deal. As a united UAW, we intend to enforce our contract, and to make Stellantis keep the promise.”
    Stellantis, which has delayed plans for the Illinois plant, did not immediately respond to a request for comment.
    The company argued lin August that it “has not violated the commitments made in the Investment Letter included in the 2023 UAW Collective Bargaining Agreement and strongly objects to the union’s accusations.”

    Read more CNBC auto news

    The union said several UAW local chapters covering thousands of members have also filed contract grievances over what they allege is the company’s attempt to move Dodge Durango production out of the U.S., allegedly in violation of the UAW’s national agreement. 
    The union did not disclose when the attempted move occurred or where the company allegedly wanted to move Durango production.

    A UAW spokeswoman cited media reports about the vehicle potentially being moved to a plant in Ontario, Canada.
    A copy of the latest National Labor Relations Board filing provided by the UAW did not mention the Durango. It accused the automaker of “refusing to provide the Union with relevant information.”
    The NLRB confirmed the UAW’s filing. The union has multiple open charges against several automakers in the U.S.
    The UAW said Monday it has more than 24 open grievances against Stellantis regarding the company’s product and investment plans disclosed as part of the union’s contract with the automaker. More

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    In federal trial, Michael Kors says it’s harder to sell handbags in TikTok and Taylor Swift era

    Fashion designer Michael Kors testified Monday about competition in the handbag industry.
    The Federal Trade Commission is seeking to block Tapestry’s $8.5 billion acquisition of Capri, which would put six brands including Michael Kors and Coach under a single company.
    The trial is expected to wrap up on Tuesday.

    Designer Michael Kors poses backstage before the Michael Kors Collection Fall 2017 runway show at Spring Studios in New York City on Feb. 15, 2017.
    Dimitrios Kambouris | Getty Images

    NEW YORK CITY — In a federal courtroom on Monday, storied fashion designer Michael Kors spoke about the steep challenge of staying relevant in a world where brands can rise and fall based on viral TikTok videos and photos of handbags on the arms of celebrities such as Taylor Swift and Beyoncé.
    Kors kicked off the week of testimony in the antitrust trial in Manhattan as a Federal Trade Commission lawsuit seeks to block Tapestry’s $8.5 billion acquisition of Capri. The deal, if approved, would put six fashion brands under a single company: Tapestry’s Coach, Kate Spade and Stuart Weitzman, with Capri’s Versace, Jimmy Choo and Michael Kors. 

    The FTC on Monday called Kors, who founded his namesake brand in 1981 at age 22 and still serves as its chief creative director, to testify. Yet, in his remarks, Kors described how even legacy brands like his own can struggle and lose shoppers’ interest.
    “Sometimes you’ll be the hottest thing on the block,” he said. “Sometimes you’ll be lukewarm. Sometimes you’ll be cold.”
    He acknowledged that his namesake label has fallen from favor and needs a refresh.
    “I think we’ve reached the point of brand fatigue,” he said.
    The FTC has argued that the combined companies, particularly with Coach and Michael Kors under the same owner, would create a bag behemoth with the power to hike prices for customers while offering them the same or worse products.

    Attorneys for Tapestry and Capri, on the other hand, have questioned the FTC’s depictions of a consolidated handbag market. They have said competition has grown as customers consider both pricier luxury brands and lower-priced fast-fashion names, and can shop from online-only platforms and secondhand marketplaces.
    The trial comes as consumers balk at high prices and when the outcome of the closely watched U.S. presidential election could change the federal agency’s strategy.
    Shares of Capri, which includes Michael Kors, reflect the tougher stretch that the designer Kors described. As of Monday afternoon, the company’s stock has fallen about 24% so far this year. That trails far behind the roughly 18% gains of the S&P 500 and the approximately 17% rise of Tapestry.
    In its most-recent fiscal quarter that ended in late June, Michael Kors’ revenue dropped 14.2% on a reported basis or 13.3% on a constant currency basis compared to the year-ago period.
    Kors said he remains a student of the fashion industry and draws inspiration from spending time on store floors, talking to customers or people-watching at places such as airports. Even as an industry veteran, he said he must move nimbly.
    For instance, he said he learned about Aupen, a handbag industry newcomer, when he saw a photo of Taylor Swift carrying one of the company’s handbags. When he went to the company’s website, it crashed, he said.
    “It shows you the power of women like this,” he said.
    In another testimony on Monday, former Macy’s CEO Jeff Gennette said retailers also feel it when brands lose some of their shine. Gennette, who retired early this year, said the department store’s sales got hit because it leaned too heavily on Michael Kors’ brand. He said the markdown of Michael Kors’ handbags contributed to “a bad spiral Macy’s was living through when I was there.”
    The antitrust trial is expected to conclude on Tuesday with testimony by economists, including one for the FTC and one for the companies.

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    The Federal Reserve’s interest-rate cuts may disappoint investors

    The longed-for moment is almost here. For two and a half years, ever since America’s Federal Reserve embarked on its fastest series of interest-rate rises since the 1980s, investors have been desperate for any hint of when it would reverse course. Now it would be a huge surprise if Jerome Powell, the central bank’s chair, did not announce the first such reduction after its rate-setting committee meets on September 18th. Indeed, among traders, the debate is no longer “whether” but “how much”. Market pricing implies roughly a 40% chance that officials will cut their policy rate, currently between 5.25% and 5.5%, by 0.25 percentage points, and a 60% chance that they will instead opt for 0.5. More

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    This is the ‘billion-dollar blind spot’ of 401(k)-to-IRA rollovers, Vanguard finds

    Moving money from a workplace retirement plan like a 401(k) plan to an individual retirement account is common when switching jobs or retiring.
    Savers are often unaware their 401(k)-to-IRA rollovers sit in cash as a default.
    Holding excess cash is generally a mistake for long-term investors.

    Sergio Mendoza Hochmann | Moment | Getty Images

    Many investors unknowingly make a costly mistake when rolling their money from a 401(k) plan to an individual retirement account: leaving their money in cash.
    Rollovers from a workplace retirement plan to an IRA are common after reaching certain milestones like changing jobs or retiring. About 5.7 million people rolled a total $618 billion to IRAs in 2020, according to most recent IRS data.

    However, many investors who move their money to an IRA park those funds in cash for months or years instead of investing it — a move that causes their savings to “languish,” according to a recent Vanguard analysis.

    About two-thirds of rollover investors hold cash unintentionally: 68% don’t realize how their assets are invested, compared to 35% who prefer a cash-like investment, according to Vanguard.
    The asset manager surveyed 556 investors who completed a rollover to a Vanguard IRA in 2023 and left those assets in a money market fund through June 2024. (Respondents could report more than one reason for holding their rollover in cash.)
    “IRA cash is a billion-dollar blind spot,” Andy Reed, head of investor behavior research at Vanguard, said in the analysis.

    ‘It always turns into cash’

    The retirement system itself likely contributes to this blind spot, retirement experts said.

    Let’s say a 401(k) investor holds their funds in an S&P 500 stock index fund. The investor would technically be liquidating that position when rolling their money to an IRA. The financial institution that receives the money doesn’t automatically invest the savings in an S&P 500 fund; the account owner must make an active decision to move the money out of cash.
    More from Personal Finance:Stocks often drop in September. Why you shouldn’t careDon’t expect ‘immediate relief’ from Fed rate cutMomentum builds to eliminate certain Social Security rules
    “That’s one of the challenges: It always turns into cash,” said Philip Chao, a certified financial planner and founder of Experiential Wealth based in Cabin John, Maryland. “It sits there in cash until you do something.”
    About 48% of people (incorrectly) believed their rollover was automatically invested, according to Vanguard’s survey.

    When holding cash may be a ‘mistake’

    Grace Cary | Moment | Getty Images

    Holding cash — perhaps in a high-yield savings account, a certificate of deposit or a money market fund — is generally sensible for people building an emergency fund or for those saving for short-term needs like a down payment for a house.
    But saving bundles of cash for the long term can be problematic, according to financial advisors.
    Investors may feel they’re safeguarding their retirement savings from the whims of the stock and bond markets by saving in cash, but they’re likely doing themselves a disservice, advisors warn.
    Interest on cash holdings may be too paltry to keep up with inflation over many years and likely wouldn’t be enough to generate an adequate nest egg for retirement.

    “99% of the time, unless you’re ready to retire, putting any meaningful money in cash for the long term is a mistake,” Chao said. “History has shown that.”
    “If you’re investing for 20, 30, 40 years, [cash] doesn’t make sense because the return is way too small,” Chao said.
    Using cash as a “temporary parking place” in the short term — perhaps for a month or so, while making a rollover investment decision — is OK, Chao explained.
    “The problem is, most people end up forgetting about it and it sits there for years, decades, in cash, which is absolutely crazy,” he said.

    Relatively high cash returns over the past year or two in some types of cash accounts — perhaps around 5% or more — may have lulled investors into a false sense of security.
    However, investors are “unlikely to keep those returns for long,” Tony Miano, an investment strategy analyst at the Wells Fargo Investment Institute, wrote Monday.
    That’s because the U.S. Federal Reserve is expected to initiate a round of interest-rate cuts this week. Investors should “start repositioning excess cash,” Miano said.
    Investors should also question if it’s necessary to roll money from their 401(k) plan to an IRA, as there are many pros and cons, Chao said. More

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    Charter rolls out new Spectrum pricing and internet speeds, aims to ‘be a better service operator’

    Cable giant Charter Communications, under the brand Spectrum, is unveiling new pricing and customer service changes meant to prove its commitment to reliability.
    The changes come as cable providers are experiencing major shifts in their broadband, TV and mobile businesses.
    Broadband, the bedrock of the cable industry, has experienced a slowdown in customer additions. Meanwhile, the fledgling mobile business has rapidly grown.

    Christopher L. Winfrey, CEO of Charter Communications.
    Courtesy: Charter Communications

    Charter Communications CEO Chris Winfrey said he wants customers to think of reliability and credibility when they think of their cable and broadband provider.
    The cable giant told CNBC it is unveiling a series of changes Monday to bolster that goal, including rolling out new bundles and pricing, increasing internet speeds, offering credits for service outages and promising heightened reliability for customers.

    Charter — which provides broadband, cable TV and mobile services and is known to customers under the name of Spectrum — said it is also trying to make the company more approachable and remove the longtime negative connotations around cable companies by announcing Spectrum’s new “first-of-its-kind customer commitment,” branded as “Life Unlimited.”
    The rollout comes as Charter and its industry peers contend with several trends: slowing broadband customer growth, continued defections from the cable TV bundle, and a young but speedily expanding mobile business.

    “It is hard to be loved when you’re providing a critical service to the household that’s a physical infrastructure that charges over $100 a month,” Winfrey said in an interview with CNBC. “And to the extent there’s a problem, sometimes somebody has to enter your home … in the same vein that it is for an electrician or plumber.”
    The first step to changing a less-favorable consumer view is with “pricing and packaging that creates more value than you can replicate anywhere else in the marketplace,” he said.
    Spectrum said it will charge as low as $30 a month for its 500Mbps internet plan, or $40 a month for 1GB service, when either are bundled with two mobile lines or cable TV. The company is also increasing the baseline internet speed for current customers at no additional cost.

    The company also said it’s planning to be upfront about costs. Under its new plan, taxes and fees are baked in, there are no annual contracts and pricing is guaranteed up to three years, it said. Charter even eliminated the 99 cents it had tacked on to most of Spectrum’s pricing in the past.
    In addition, Spectrum pledged to give customers credits when the company’s customer service doesn’t live up to its promises, or for internet outages that are out of the customer’s control but are due to an issue on the company’s part and last more than two hours. Service issues such as those caused by weather, natural disasters or power outages don’t count.
    Life Unlimited — a new platform for Spectrum’s internet, mobile and TV services — will roll out across its 41-state footprint this week, the company said.
    “We wanted to make a bold statement about our commitment and our capabilities,” Winfrey said. “We also wanted to recognize that we’re not perfect and we’re putting ourselves under pressure, concrete pressure, to make sure that we can be a better service operator every month and every year from here on out.”

    Pricing power

    The Charter Communications logo is displayed on a smartphone.
    Sopa Images | Lightrocket | Getty Images

    The announced changes are some of Charter’s biggest moves since Winfrey took the helm as CEO in December 2022.
    He followed Tom Rutledge, who held the post for a decade and turned a relatively small cable operator into the second-largest cable company in the U.S. through the takeovers of Time Warner Cable and Bright House Networks in 2016. Winfrey was CFO at the time and spearheaded the mergers.
    Winfrey recalled the various investments and advancements cable companies had made over the years: namely in broadband, but also in the pay TV bundle and the landline and mobile phone businesses.
    “For all the value that the industry’s brought over the years, and the service and reliability investments that we’ve made, we haven’t always gotten the full credit that we deserve, and in some cases, we did get the credit we deserve because we could have done things better,” Winfrey said.
    He entered the top job at a moment when it was clear growth was unlikely to return to the cable TV bundle.
    Winfrey had been a low-key and not widely known executive in the media industry, but he started off swinging.
    At an investor day in December 2022, Charter announced an aggressive capital investment plan that included putting $5.5 billion over three years in its broadband infrastructure network. The higher-than-expected spending during a time of growing competition from 5G wireless providers sent alarms through Wall Street, and the stock dropped.
    Charter’s stock price has fluctuated greatly in recent years. On Sept. 12, 2021, the stock price was $787.12. It closed at $340.17 on Friday.

    Stock chart icon

    Charter’s stock has fluctuated in recent years as there’s been a slowdown in broadband subscriber growth.

    That’s in part because broadband customer growth at providers including Charter and Comcast has struggled, according to the companies’ earnings reports. Increased competition from wireless companies such as AT&T and Verizon has also played a role in the stagnation, as has the slowdown in the buying and selling of houses due to high interest rates.
    The third quarter was the worst ever for broadband industry subscriber losses, according to MoffettNathanson. Charter lost 149,000 subscribers and had a total of 30.4 million residential and small business broadband customers as of June 30, according to its second-quarter earnings report.

    While the losses weren’t as substantial as analysts had feared, Charter’s growth bright spot is now its mobile business, which launched in 2018. Spectrum Mobile has 8.8 million total lines and has grown rapidly due to enticing promotional deals and increased mobile usage on reliable Wi-Fi networks, the company said.
    In late 2022, Charter announced its “Spectrum One” plan, the first time it offered broadband, Wi-Fi and mobile in a bundle with promotions that included competitive rates and, in some cases, free mobile lines.
    “For wireless, the ‘Spectrum One’ promotion will almost certainly turn out to have been a home run,” analyst Craig Moffett said in a research note in July. “Despite the fact that it was initially viewed as shockingly aggressive, it was, in fact, a rather modest offer.”
    Moffett called mobile an “underappreciated growth engine” for Charter, not only because of customer additions but also growth in average revenue per user, or ARPU, which is a metric often used by cable companies.
    Winfrey doesn’t expect ARPU to be affected by the new promotions.
    “When I think about Wall Street, I think about the customer,” Winfrey said. “If you focus on the customer, provide great customer service, save them money, provide value, then your capital market strategy, your regulatory strategy, all of that just falls into place.”

    Tough on TV

    A detail view of an ESPN Monday Night Football NFL logo is seen on a tv camera in action during a game between the San Francisco 49ers and the Baltimore Ravens at Levi’s Stadium on December 25, 2023 in Santa Clara, California. 
    Robin Alam/isi Photos | Getty Images Sport | Getty Images

    Customers have been dropping pay TV rapidly across all providers, including Charter. But the company has been vocal about its efforts to preserve the business, especially under Winfrey’s leadership.
    The biggest moment came in 2023 when Disney-owned networks went dark for Charter’s customers and Winfrey called the pay TV ecosystem “broken” as he pushed for a revamped deal with Disney.
    While these disputes are common — Disney and DirecTV on Saturday ended a roughly two-week blackout fight — this one was different in the age of streaming.
    For Charter, the sticking point wasn’t just the fees. The company wanted Disney’s ad-supported streaming options to be part of its TV offering.
    Pay TV providers often say the rates that programming companies such as Disney seek from them are too high, especially since the programmers are also funneling much of their content into streaming platforms. Although the cable bundle loses customers, cable providers note it’s still a cash cow while streaming chases profitability.
    “Credit to Disney, eventually they were willing to lean in and they understood their role in the industry,” Winfrey said, adding that ESPN is considered the linchpin of the cable TV bundle. “They had to be the leader in the space, and we knew that.”
    The deal allowed for ad-supported Disney+ and ESPN+ to be included in “Spectrum TV Select” packages. In addition, when ESPN launches its direct-to-consumer streaming option — which is expected to debut in fall 2025 — these customers will receive access to it, too.
    “I give Charter a ton of credit because they walked into the room and they had very specific ideas. They had a vision that they wanted to execute against, and again, it was a hard negotiation,” ESPN Chairman Jimmy Pitaro said on CNBC on Sept. 3 when discussing the blackout fight with DirecTV.
    Depending on the tier a customer subscribes to, their package can include the ad-supported versions of streamers Disney+, ESPN+, Max, Discovery+, Paramount+, AMC+, BET+ and/or Televisa Univision’s Vix.
    The deals have also given Charter the opportunity to sell and market the streaming services to its broadband-only customers — and includes a revenue share agreement.
    The most recent deals with Warner Bros. Discovery and AMC Networks were early renewals. That’s relatively uncommon in an industry where carriage negotiations often come down to the wire.
    Charter last year also started offering its own streaming devices, known as Xumo, through a joint venture with Comcast. The device gets rid of the cable box and gives consumers a way to access both their cable TV and streaming apps in one place.
    “We still have hurdles to get through,” Winfrey said, noting that Charter’s goal is to offer all ad-supported streaming apps owned by the major programmers it negotiates with on the cable TV bundle in the first half of 2025.
    NBCUniversal’s Peacock is still not part of that roster, however. A Charter representative said the company doesn’t discuss renewals and declined to comment.
    Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.
    Correction: A chart in this article showing changes in residential internet subscribers has been updated. More