Led by Comcast and Charter, the US cable industry put a bigger dent in the mobile market this year and kept pace in a race to convergence against its rivals.
The US cable industry has gone through fits and starts trying to add mobile to the service bundle over the years.
Among them, the "Pivot" joint venture between Sprint, Comcast, Time Warner Cable and Cox Communications dried up in 2008. Later, Cox developed its own mobile service and embarked on a soup-to-nuts wireless network buildout of its own, only to shut the whole thing down later, lamenting that it had neither the scale nor the access to the kind of devices – primarily, Apple's iPhone – to become a competitive force in the mobile market.
That was more than a decade ago. These days, US cable is enjoying success in the mobile business even as its cornerstone business – home broadband – is struggling to gain customers and return to overall subscription growth.
But cable has finally hit the mark by focusing on bundling home broadband and mobile and creating an early form of convergence that cable's key competitors, including AT&T, Verizon and T-Mobile, are now trying to emulate with fiber network buildouts alongside a wave of fiber-focused M&A. Analysts such as MoffettNathanson's Craig Moffett believe that cable's got the advantage because it's in position to offer the convergence bundle everywhere they offer broadband compared to the pockets where rivals have fiber.
Comcast and Charter have had the most success with this strategy. Their respective mobile services, which ride Verizon's mobile network in tandem with their own Wi-Fi networks, had a combined 16.92 million mobile lines in service at the end of the third quarter of 2024. Among that duo, Comcast's Xfinity Mobile penetration represented about 12% of its domestic residential broadband subscriber base at the end of Q2.
Altice USA, whose Optimum Mobile service rides the T-Mobile Network, has a much smaller mobile base but has been ramping up the marketing of mobile alongside its own broadband/mobile bundle. Meanwhile, a growing wave of small and midsized cable operators have also gotten into the mobile game over the past year on their own or through the National Content & Technology Cooperative's (NCTC's) pacts with AT&T and Reach.
Beyond 'equilibrium'
Many companies on that list are privately held, so we don't have an exact count of their combined mobile lines. However, the cable industry is on a path to eventually reach mobile "equilibrium," a state in which new gross adds are equal to the number of subs being lost to churn. MoffettNathanson estimates that such a state would be reached when cable nets 32.68 mobile lines.
But the story is not merely about mobile line growth. There's a push underway among some cable operators to push convergence further by putting all services onto a core platform along with some limited buildouts of CBRS spectrum in high-usage areas that can help reduce MVNO costs.
Examples of moving the needle on convergence are underway. Notably, Charter is preparing to deploy a principal core system from Vecima Networks that the vendor recently acquired from Falcon V Systems. Meanwhile, Comcast has cut a deal to shift its 5G core to AWS.
Expect this general storyline to continue and take further shape in 2025. Meanwhile, here's a smattering of cable's mobile headlines from the past year:
2/27/2024: TVS Cable first to launch mobile through NCTC pacts with AT&T and Reach
3/25/2024: Comcast cuts price on some mobile plans
8/16/2024: Cable's wireless blitz picks up more steam
9/16/2024: Charter leans harder into convergence with 'Life Unlimited'
9/12/2024: US cable could reach mobile 'equilibrium' at 32.68M lines
10/17/2024: Verizon: Frontier needs mobile to compete with cable
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