US cable snares lion's share of mobile growth in Q1

US cable operators snagged about three of every four post-paid mobile net adds in Q1 and continues to hold an advantage over AT&T, Verizon and T-Mobile when it comes to fixed/wireless convergence, analyst says.

Jeff Baumgartner, Senior Editor

June 6, 2024

2 Min Read
Charter Spectrum Mobile product featured in store
(Source: Charter Communications)

US cable operators continued to put pressure on AT&T, T-Mobile and Verizon in mobile, grabbing the bulk of net adds in the first quarter. And US cable continues to wield an advantage with respect to fixed/wireless convergence, a top industry analyst believes.

US cable took the lion's share of mobile industry growth in Q1, snagging roughly three of every four industry post-paid net adds in the period, MoffettNathanson found in its latest mobile industry report (registration required).

cable_mobile_gross_ads_through_Q1_2024_charet.jpg

US cable has also secured solid footing on post-paid gross ads, with 16.5% in the quarter. That compared to T-Mobile, which led with 30.3%, Verizon (29.3%) and AT&T (23%).

Cable's ability to bundle (Charter Communications, Comcast and Cox Communications, for example, only sell mobile to subs who also take their respective home broadband services) and deliver industry-low pricing for mobile are advantages that MoffettNathanson Analyst Craig Moffett is bullish about.

"All of Cable's gross additions were sold on a bundle of broadband and wireless together," he pointed out.

Cable's bundling and mobile pricing strategy is helping to fuel mobile line growth. Operators are also getting more aggressive in the market. Comcast, for example, recently lowered pricing on select family plans, and Charter has introduced a contract buyout option.

"Cable is leaning into a bundled pricing discount…because they can," Moffett surmised. "Although the price gap narrows for larger families, Cable's pricing offers significant savings for people with 1-3 lines," the analyst surmised.

Convergence gap

Another challenge ahead for mobile's Big Three is a lack of wireline infrastructure they can pair with wireless – something Moffett calls "faux convergence."

AT&T is the furthest along, with fiber available to about 12% of US households, versus 9% for Verizon. T-Mobile clearly sees this gap as it continues to secure access to fiber in multiple markets and forge fiber-focused agreements, including a recently-formed joint venture centered on Lumos.

"The TelCos' wireless footprints simply don't support a converged offering," Moffett notes.

And though cable appears to have a leg up in the convergence conversation, it doesn't mean the mobile giants are in major trouble. But it could cause the Big Three to adjust their pricing strategies and possibly impact their ability to grow average revenue per user (ARPU).

"There's nothing truly unique about the services themselves that convergence makes possible," at least for the moment, Moffett explained. "The bad news is that convergence likely does mean the Big Three will eventually have no choice but to respond to cable's industry-low pricing."

For now, Comcast and Charter are putting on the most pressure on the top mobile players, followed by Altice USA and Cox Communications. Meanwhile, various small and midsized cable operators, including Mediacom Communications, Breezeline and Astound Broadband, have recently entered the mobile fray.

About the Author(s)

Jeff Baumgartner

Senior Editor, Light Reading

Jeff Baumgartner is a Senior Editor for Light Reading and is responsible for the day-to-day news coverage and analysis of the cable and video sectors. Follow him on X and LinkedIn.

Baumgartner also served as Site Editor for Light Reading Cable from 2007-2013. In between his two stints at Light Reading, he led tech coverage for Multichannel News and was a regular contributor to Broadcasting + Cable. Baumgartner was named to the 2018 class of the Cable TV Pioneers.

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