Our investment in the cable industry via Charter Communications (CHTR, Financial) (up approximately 70%) along with Comcast (CMCSA, Financial) (up approximately 34%) were two notable contributors in 2019.5 We made these investments in mid-2018, when many investors were concerned that subscribers would cut the cord in favor of streaming and when wireless 5G threatened to damage these companies’ dominant broadband franchise. Our belief remains that while video will continue to shrink, video is less profitable on a cash basis than many believe it to be. Thus, we think broadband should remain vibrant, as it is likely to take many years and many billions of dollars before the potential impact of the competitive threats is known. The market has sidled over to our thinking on this, at least for the time being.
From Steven Romick (Trades, Portfolio)'s FPA Cresent Fund fourth-quarter 2019 shareholder letter.
