Fiber remains Comcast's biggest long-term competitor, but FWA is a 'new overbuilder for a segment of the market' that the operator is responding to with its Internet Essentials option and new prepaid NOW products, says Comcast President Mike Cavanagh.
Comcast still sees fiber networks as its biggest competition in the long term, but a top exec acknowledged fixed wireless access (FWA) as a "near-term issue" that is taking a piece of the lower end of the market.
"We think of fixed wireless as a new overbuilder for a segment of the market," Comcast President Mike Cavanagh said Tuesday at the Goldman Sachs Communacopia + Technology Conference.
Although the pace of FWA subscriber growth among some of the top US service providers is showing signs of slowing, T-Mobile, Verizon and AT&T still posted FWA subscriber gains in the second quarter of 2024. Comcast, meanwhile, lost 120,000 broadband subs in the period.
Targeted response to the FWA threat
Comcast is taking a measured response to FWA with products that hit on aspects of fixed wireless that consumers find appealing – namely, low pricing with enough speed to handle most of their day-to-day needs.
Comcast has "punched up" Internet Essentials, its home Internet service for qualified low-income households, said Cavanagh. In addition to a baseline Internet Essentials offering of 50 Mbit/s (downstream) for $9.95 per month, the company also offers an Internet Essentials Plus tier that delivers 100 Mbit/s (downstream) for $29.95 per month.
Comcast also offers a set of "NOW" branded prepaid home Internet, pay-TV and mobile products. That lineup currently features home Internet tiers that deliver 100 Mbit/s for $30 per month and 200 Mbit/s for $45 per month, plus unlimited data and a Comcast-supplied gateway.
Cavanagh said those products fit in with the operator's strategy to segment the market.
"Rather than worrying about repricing the whole book of business, we're trying to be deliberate and not chase the whole business down to a level that's really solving a problem [in the] more value-conscious end of the market," Cavanagh explained. "I think it's the appropriate type of response, but we fully expect fixed wireless to take a share of the market. It's not at the deep, profitable end of the market, but it's a market we still want to serve because we want to segment and serve everyone well."
Comcast is pairing that strategy with one focused on network upgrades, including an emerging DOCSIS 4.0 platform that enables symmetrical, multi-gigabit speeds across its widely-deployed hybrid fiber/coax (HFC) network. Comcast has begun to deploy D4.0 in several markets including Atlanta, Philadelphia and Colorado Springs, Colorado, with other markets like Seattle on deck for the upgrade.
Potential for 'clogged up' networks
Comcast continues to hold the view that FWA services that use valuable licensed spectrum will have a hard time keeping up with data demands, particularly as more live-televised sporting events shift to streaming platforms.
"As those [FWA] networks start to get clogged up – which maybe they will maybe they won't – but I believe it will be a challenge...that they'll have to navigate their way through," Cavanagh said.
He noted that the average data usage on Comcast's networks is at about 700 gigabytes today, up from just 200GB about five years ago.
From a broader perspective, OpenVault's Q2 Broadband Insights Report (registration required) found that the monthly average data consumed by broadband subs in the period was 585.8GB, up 9.7% from the year-ago period. Additionally, the percentage of "power users" consuming 1 terabyte or more per month in Q2 2024 was 18.2%, a year-over-year increase of 16.5%.
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