Comcast's Home Hotspots Heat Up
After numerous false starts, the cable industry has finally found its way in wireless by embracing WiFi technology. "WiFi is really our mobile network of choice," Comcast Senior Vice President Tom Nagel told Light Reading recently.
Nagel has reason to be satisfied with that decision. US cable operators have deployed more than 250,000 public WiFi hotspots across the country, covering such major metropolitan areas as Atlanta, Chicago, Los Angeles, and New York. And there's no sign of tapering consumer demand.
For Comcast Corp. (Nasdaq: CMCSA, CMCSK) alone among US MSOs, however, the hotspot movement has included a major extension into subscriber homes. Starting last summer, Comcast has carried out its new home hotspot initiative, turning residential routers into nodes in a far-reaching wireless network open to all subscribers. Home hotspots separate out the private data traffic of household residents from the activity of other Comcast customers, and public usage doesn't count toward the owner's monthly bandwidth cap. (See Comcast Turns Homes Into Hotspots.)
These home hotspots aren't available yet across Comcast's entire footprint. But the company is now approaching a milestone of 1 million activations, and Nagel says Comcast will continue to roll out neighborhood hotspots aggressively throughout 2014.
Now that the home hotspot initiative is several months old, we asked Nagel what Comcast has learned from its initial deployments. He said that very few subscribers have opted out of the program -- well under 1% -- and that usage of home hotspots continues to rise. Not only are more devices connecting to the company's WiFi networks, but they are also staying connected for longer periods and connecting from locations farther away from home.
"More devices are coming on, on average," said Nagel, "but they're also using it more, and then the home hotspot is really having an upward impact on the amount of usage not just around the home, but around other places that are a distance from the home. So we sort of look at utilization of the network more than a mile from your home, assuming that that's clearly outside your neighborhood, and there's been a good uptick once we begin to add the home hotspots."
While some critics have chastised Comcast for not communicating strongly enough about the subscriber opt-out option for home hotspots, Nagel argued that even in markets where the technology has been turned on for months -- and therefore awareness has increased -- the drop rate hasn't gone up. He also pointed out that Comcast sends a letter to subscribers when the feature is launched in a market and that the company posts information online and shares details of the program with local press outlets.
The rapid increase of home hotspot use makes sense in a world where consumers are already selectively offloading their mobile Internet activity from cellular networks. According to Nagel, between 60% and 75% of mobile traffic is currently conducted over WiFi connections. He noted that Comcast has unique scale among cable operators to extend WiFi access because of the advanced wireless gateways it is now deploying. He also emphasized the importance of security, and how that will continue to be a high priority as WiFi connections expand and consumers start to move seamlessly between networks. (See Momentum Mounts for Cable WiFi.)
Inspired by Comcast, other US cable companies are eyeing the home hotspot model, but have only run limited tests so far. Reports in at least one online user forum suggest that both Cablevision Systems Corp. (NYSE: CVC) and Time Warner Cable Inc. (NYSE: TWC) are running trials. Plus, back at the SCTE Cable-Tec Expo last October, Cox Communications Inc. Vice President Kelly Williams told a Light Reading breakfast forum crowd that home hotspots are "definitely on our radar and something we could do in 2014." (See Can Cable WiFi Scale?.)
Unlike in some other countries, such as Brazil and the Netherlands, the home hotspot movement in the US is still in its early days. It's one more example, however, of how the US cable industry is turning WiFi to its advantage.
And it's hard to argue with the investment when cable companies are finally gaining traction with a wireless broadband product. Ironically, in Comcast's case, the company's growing success outside the home is being aided by the gateways that it's deploying inside subscriber households. When every home is a hotspot, WiFi access spreads rapidly, and so does Comcast's wireless footprint.
— Mari Silbey, special to Light Reading