Since its big RDOF win several years ago, Charter has received funding to cover some of the costs of deploying broadband to 260,000 more rural locations from state and “other” sources, said Charter CEO Chris Winfrey at an investor conference today.

And there likely will be more to come.

“Our BEAD chances are very good,” said Winfrey, in a reference to the upcoming $42.5 billion Broadband Equity Access and Deployment program.

Winfrey also offered some new details on how Charter became so bullish on rural broadband.

The company was required to make service to 185,000 rural locations in upstate New York as a condition of regulatory approval for its acquisition of Time Warner Cable.

“We looked at it as a tax on the deal,” said Winfrey.

But “it actually turned out to be great,” he said, “which is we had so much confidence going into RDOF.”

The company was one the largest winners in the Rural Digital Opportunity Fund (RDOF) auction, which awarded funding for an area to the company that committed to deploying service for the lowest level of government support.

Charter is now ahead of schedule on its $5 billion RDOF build, to which the government contributed about $1 billion.

“We’ve got this pipeline and we’re delivering and we’re ahead of schedule,” he said.

Winfrey cautioned, though, that the company might not seek BEAD funding in some states, depending on the rules that those states put in place.

The company, he said, wants to make sure that rules work for private capital – an apparent reference to rules that some states have contemplated that would require public ownership of BEAD-funded projects.

While noting that rural builds have a long payback, Winfrey noted that the IRR (internal rate of return) on rural builds is very high and “the risk is extremely low.”

Winfrey also noted that Charter’s rural strategy positively impacts the company’s valuation within about four years.

“The payback is pretty fast from a valuation perspective,” he observed.

Winfrey made his comments about Charter rural funding at SVB MoffettNathanson Technology, Media and Telecom Conference. A replay is available at this link.

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