From AT&T to Shentel: Tracking the Top 17 Residential Broadband Service Providers

As the COVID-19 pandemic forced more people to work remotely and students conduct remote learning, telco and cable operators continue reined in more broadband subscribers in 2020 since 2008. 

 

  • Broadband Penetration

As the pandemic drove workers to telecommute and students to attend school from home, wireline telco and cable operators have seen a surge in broadband subscriptions to support conferencing applications like Zoom to conduct business and remote learning.

A new Leichtman Research Group (LRG) report found that the largest cable and wireline phone providers in the U.S. – representing about 96 percent of the market – acquired about 4.86 million net additional broadband internet subscribers in 2020, compared with a pro forma gain of about 2.55 million subscribers in 2019.   

These top broadband providers now account for 105.8 million subscribers; top cable companies have 72.8 million broadband subscribers, and top wireline telcos have 33 million.

We are tracking the top 17 broadband providers. This list includes the top telco and cable operators, ranked by the total number of broadband subscribers they had as of the end of the second quarter.

In this report we track three main metrics:

Total Broadband Subscribers: Here we looked at the total number of subscribers these 17 providers had as of the end of the quarter and for the year 2020. In the broadband race, it’s clear that cable continues to maintain has the upper hand, controlling a large market share of the U.S. residential broadband market. This segment was led by Comcast and Charter with a total of 30.6 million and 29 million total subscribers, respectively. According to LRG, cable had a total of more than 73 million subscribers, while telcos ended the year and quarter with a total of only 33 million broadband subscribers. 

Broadband Additions, Losses: Cable clearly commanded the broadband market during the fourth quarter, with seven U.S. cable companies signing up residential high-speed internet users in the fourth quarter. Comcast reported the biggest growth of users with 538,000, followed by Charter with 216,000 new subscribers. Cable’s aggressive DOCSIS 3.1 rollouts, which enable operators to deliver 1 Gbps over existing HFC infrastructure, continue to be attractive in markets in which telcos offer only DSL.

The top cable companies added about 4.82 million subscribers in 2020 – compared with about 3.145 million net adds in 2019, and the most in any year since 2006. Charter’s 2.215 million net broadband additions in 2020 were more than any company had in a year since 2006.

The effect of cable’s DOCSIS 3.1 and DOCSIS 4.0 drives was clearly felt by traditional telcos, which lost more wireline broadband users, a slight improvement compared with the same period in 2019. A big piece of this for large telcos such as AT&T and Lumen was the decline of lower-speed DSL subscribers. AT&T and Lumen lost legacy DSL subscribers during the quarter. Specifically, AT&T lost 242,000 IP non-fiber and 33,000 DSL subscribers while Lumen lost 19,000 lower-speed subscribers.

It should be noted, however, that AT&T and Lumen did report gains in fiber to the home (FTTH). AT&T added 273,000 fiber subscribers and Lumen added 54,000 subscribers who purchased speeds of 100 Mbps and higher. Meanwhile, Verizon added 92,000 new Fios internet subscribers during the fourth quarter.

At the end of 2020, cable MSOs had a 69 percent broadband market share – a wide margin over telcos’ 31 percent. The top telcos added about 40,000 subscribers in 2020, compared with a loss of about 590,000 subscribers in 2019. Telcos had positive net annual broadband adds for the first year since 2014.

Broadband Revenues: As the largest cable operators and telcos continue to add more broadband subscribers, they will enhance broadband revenues. Just as they had the highest number of subscribers, Comcast and Charter had the largest broadband revenues: $5.4 and $4.86 billion, respectively. AT&T and Verizon reported broadband revenues of $3.1 and $2.75 billion, while Lumen’s broadband revenues were $731 million.

Look at the chart below to get a glimpse into how these providers performed. The rankings were calculated from collecting information from each service provider's earnings report. 

Service provider Total Broadband Subs Subs Added/Lost Broadband Revenue
       
Comcast 30.1M 538K $5.4B
Charter 29M 216K $4.86B
AT&T 15.4M 273K* $3.1B
Verizon  7.13M 92K Fios $2.75B
Lumen (CenturyLink) 4.54M 54K** $731M
Cox  5.4M 50K*** not reported
Frontier 3.1M -111,000 $834M
Altice USA  4.4M -4000 $942M
Mediacom 1.4M 13K $250M
Windstream  1.1M 60K (for the year 2020) not reported
Cable One 857K -8000 $176M
WOW!  813K 4K $157M
Consolidated  792K 11 $66.3M
TDS Telecom 493K**** 5K+ $153M***
Cincinnati Bell  436K 1,600 $267M
Atlantic Broadband  504K 12K not reported
Shentel  103K 18K $53.7M
       
* lost 242K IP non-fiber and 33K DSL subs      
** lost 19K lower speed subs      
*** LRG estimates       
**** includes  283,900 wireline, 209,400 cable      

We track two main types of service providers that provide wireline residential broadband services:

ILECs: Traditional telcos are at a crossroads. As more customers want higher speeds, this group is moving to deploy FTTH across select markets. After a slight pause in 2020, AT&T has committed to build fiber to over an additional 3 million locations across more than 90 metro areas. Lumen has 675,000 FTTH customers and has enabled 2.4 million sites.

Cable MSOs: Cable MSOs made their broadband business by delivering broadband over HFC. Apart from deploying FTTH in select greenfield markets, the advent of DOCSIS 3.1 enables cable MSOs to offer 1 Gbps over their existing hybrid fiber-coax (HFC) plant. However, some providers, such as Altice USA, are opting to move toward an all-FTTH approach.

(Also, make sure to check out Broadband Communities’ report From AT&T to Verizon: Sizing up Q4 Broadband 2020 Earnings)

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