Altice USA Signs AT&T to Nationwide Roaming Deal
Altice USA is getting some additional air cover as it nears the summer launch of its mobile service.
Altice USA said Wednesday that it has secured a new nationwide roaming contract with AT&T that complements the coverage it's getting from Altice USA's underlying full MVNO deal with Sprint and the cable operator's own WiFi network.
The deal with AT&T "ensures an aggregate 99% nationwide coverage" when Altice Mobile launches later this year, Dexter Goei, Altice USA's CEO, explained today on a media call timed with company's Q2 2019 financial results. The AT&T deal will give Altice's forthcoming mobile service coverage in areas where Sprint does not offer service.
Altice USA has also inked some new international roaming contracts with multiple partners that will provide additional global coverage, he added.
Goei also reiterated that Altice USA's agreement with Sprint is poised to be expanded to the new T-Mobile network, inclusive of 5G services, via a contract extension pursuant to the DoJ's conditions on the proposed T-Mobile/Sprint merger and T-Mobile's merger commitments to the FCC.
Altice USA has not announced a launch date or pricing and packaging for Altice Mobile, but the service is currently available to employees for $25 per line. Pricing on the employee offering may not mirror the commercial version of the Altice Mobile service.
Altice USA also provided several updates to other services and initiatives that are underway.
Altice USA lost 21,000 net video subs in Q2, improving on year-ago losses of 24,000. The company said Altice One, its all-services gateway/media hub, has been deployed to 429,000 customers, or 13% of its total video subs, up from 4% in the year-ago period.
Goei said Altice USA's set-top integration discussions with the various virtual MVPDs and other OTT video service providers continue, but that he doesn't expect the company to announce a virtual MVPD partnership in 2019.
Altice USA added 13,000 broadband subs in the quarter, compared to 10,000 adds in the year-ago quarter.
Increased data consumption aided by the move by customers to more expensive, higher-level speed tiers helped broadband revenues jump 13%. Goei said average household data usage is growing 20% year-on-year, and is now at about 280 Gigabytes per month.
Altice's top 10% of broadband subs consume close to 1 terabyte of data per month, and customers on tiers of 200 Mbit/s or more use 75% more data on average per month than those on services that deliver less than 200 Mbit/s.
Goei noted that Altice USA is nearing the launch of a 10 Gbit/s broadband service that will be delivered on its developing fiber-to-the-premises network. That build, primarily focused on Altice USA's Optimum footprint in New York, Connecticut and New Jersey, currently passes about 1 million homes, with 300,000 connected and ready for service, he said.
"We're also looking to continue to push those numbers going to year-end, where we think the numbers will be obviously higher than they are today," Goei said.
Altice USA said Q2 revenues rose 3.7%, to $2.45 billion, driven by residential revenue growth of 3.4%, business services revenue growth of 6.1%, and ad revenue growth of 2.8%. Net income was $86 million (13 cents per share), compared to a net loss of $98 million (13 cents per share) in the year-ago period. Free cash flow dipped 3.2%, to $472 million, due to initiatives such as Altice One, the FTTP build, network expansions to additional homes, and its emerging mobile offering.
Altice USA also bumped guidance for 2019 revenue growth to 3.0% to 3.5% from a previous expectation of 2.5% to 3%.
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— Jeff Baumgartner, Senior Editor, Light Reading