Charter Communications on Monday announced a significant reduction in the cost of its mobile services for couples and families. And Charter's chief mobile officer, Danny Bowman, told Light Reading that the company's network-convergence strategy is part of the reason it's able to provide those price cuts.

"It is a significant part of our strategy," he explained. "We're just building more and more experiences to drive more speed and the ability to drive more value to the customers, so we can continue to drive great pricing in the marketplace on mobile service. I think that's probably the most important point, as you think about our strategy and where we're going with convergence. That's what it's all about."

Charter's new mobile price reductions follow in the footsteps of a similar move by Comcast (both companies piggyback on Verizon's network for their mobile offerings). In April, Comcast said it would reduce the monthly cost of its unlimited mobile services as customers add additional lines of service, down to $30 per month when customers take four lines. It previously charged $45 per month per line.

On Monday, Charter began offering similar discounts. The cable companies' pricing strategies now largely dovetail with those from large nationwide mobile network operators – the discounts are designed to appeal to couples and families.

Undercutting the mobile competition

However, the financial analysts at New Street Research reported that Charter and Comcast now offer pricing below what wireless network operators like Verizon and AT&T charge.

"With the new pricing, Charter and Comcast are now both priced at a discount to AT&T and Verizon across all lines until the fifth line, and at a discount to T-Mobile for the first three lines," the analysts wrote in a note to investors Monday.

Figure 1: Comcast (Xfinity Mobile) and Charter (Spectrum Mobile) offer cheaper services than some of the industry's biggest mobile network operators.
(Source: New Street Research)

"Ironically, as the national carriers focus on premium unlimited, @GetSpectrum Mobile and Xfinity Mobile have the role of upstart competitors with solid discounts," tweeted analyst Jeff Moore of Wave7 Research, a research and consulting firm that closely tracks mobile pricing and promotions in the US market.

"The reason we got into mobile is to grow," Charter's Bowman told Light Reading. And he explained that Charter's new pricing ought to aid in that pursuit. Already the company is nearing a base of 3 million mobile lines.

Bowman said that Charter has long worked to reduce its mobile service prices by offloading its mobile customers' traffic onto its Wi-Fi hotspots. He said most Charter mobile customers chew through roughly 80% of their overall smartphone usage on hotspots, with the remaining 20% going over Verizon's cellular network.

Wi-Fi offload is "a significant part of what we do and how we do it," he said.

And Bowman suggested Charter's plan to build a widespread 5G network with its 3.5GHz CBRS spectrum holdings would follow the same pattern. Charter, which paid $465 million for 210 CBRS priority access licenses at auction, plans to build out its first CBRS network in a yet-to-be-announced market by the end of the year, with a focus on dense high-usage areas.

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— Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano