Cable Continued to Take Broadband Market Share in Q1 2021

Led again by Charter and Comcast, cable MSOs once again racked up broadband subscribers during the first quarter.

  • cable MSOs

 

In the broadband race, cable operators have maintained their lead over telcos, offering up to 1 Gbps and above speeds over their existing hybrid fiber coax (HFC) networks. The top cable companies added about 935,000 subscribers in the first quarter.

According to Leicthman Research Group (LRG), cable’s additions were 76 percent of the net additions for the top cable companies in the first quarter of 2020.

Take a look at the table below to get a feel of how the largest cable operators performed in broadband during the fourth quarter. 

Cable Operator  Total Subs Subs added Broadband Revenues
Comcast 31M 460K $5.6B
Charter 29.2M 355K $5.1B
Cox  5.4M 55K* not reported
Altice USA  4.4M  11.6K $970M
Mediacom 1.5M 16K $259M
Cable One 880K 23K  $184M 
WOW!  823K  10K $153M
Atlantic Broadband  511K 6K not reported
    * LRG Estimates  


Tier 1 Cable Reins in Subs
Charter and Comcast continue to lead the pack in cable’s broadband race. Charter added 355,000 subscribers, while Comcast raked in another 460,000 customers during the quarter.

Tom Rutledge, chairman and CEO of Charter, told investors during its first quarter earnings call that it sees opportunities to drive its broadband base to higher speeds. 

“In terms of the broadband customer base, most of our customer base is on an entry-level package, meaning 200 megabits,” he said. “So, our basic strategy has been to have a very rich broadband product as our base product. And we've continuously taken that up. And so in terms of opportunities to sell up, we have a lot of it.”

Brian Roberts, CEO and chairman of Comcast, told investors during the cable MSO’s first quarter earnings call that as it added more broadband subscribers the cable MSO saw a reduction in customer churn.  
“Our entire company performed well and we once again had particularly strong results at Cable, which posted its third consecutive quarter of double-digit EBITDA growth, ninth consecutive quarter of double-digit net cash flow growth,” he said. “We added 461,000 broadband customers, which drove 380,000 customer relationship additions. This is the best first quarter on record. Our connect activity was healthy and broadband churn improved for the 13th quarter in a row, hitting our lowest churn rate in our company's history.”

Not far behind Charter and Comcast is Cox. Though the cable MSO is now private, it still added more than 200,000 subscribers in the year to end with a total of 5.38 million subscrbers.

Another notable cable MSO that’s poised for growth is Altice USA. Unlike Charter and Comcast, Altice has been on a two-part broadband strategy: building out FTTH and upgrading its HFC plant to DOCSIS 3.1.

Altice USA plans to reach 500,000 locations with FTTH in 2021. At the end of Q1 2021, Altice USA equipped 1 million homes, or about 20 percent of its Optimum footprint, with FTTH service. The cable MSO’s FTTH sell-in to new customers increased to approximately two-thirds of gross additions in areas where FTTH is available in the first quarter, up from 14 percent in first quarter 2020.

Dexter Goei, CEO of Altice USA, told investors that FTTH customer satisfaction remains high. “We are already seeing 25 percent higher customer satisfaction from our installed fiber customer base compared with our HFC cable customers,” he said.

Tier 2 Cable Prioritize Broadband

But the Tier 1 cable operators weren’t the only one that made progress in the first quarter. Regional cable operators are also making progress in the broadband arena.

Mediacom, Cable One and WOW! all saw sizeable gains during the first quarter. Meanwhile, Atlantic Broadband added 6,000 subscribers.

Mediacom, which reported that it added 16,000 subscribers. The cable MSO ended the quarter with a total of 1.5 million broadband customers.

Cable One reported that residential data revenues rose 18.5 percent as it added 23,000 new broadband customers during the quarter. It has been enhancing its broadband footprint with targeted acquisitions, including Hargray and earlier ValueNet Fiber.

Steven Cochran, CFO of Cable One, told investors during its first quarter earnings call that it will continue to seek out other acquisitions that could help it expand its rural market reach.

“We're always looking for opportunities to deploy our balance sheet and to grow on the strategy of broadband in rural markets, and so we'll keep our eyes open for that,” he said. “I think, clearly, with what we have with Hargray and what we have with Mega, we've got large deals ahead of us. And so I would anticipate that the stuff we're -- we'll get to see and we'll spend time on will either be investments in other businesses that set up things for the future or smaller acquisitions that are more tuck-in in scale.”

At Wide Open West, the strategy is to lead with broadband. Teresa Elder, CEO of WOW!, noted that the cable MSO increased its broadband subscriber base for the seventh consecutive quarter since launching its broadband-first strategy in early 2020.

“Our broadband-first strategy drove our results again this quarter, pushing our high-speed data revenue to its sixth consecutive record quarter as we added 10,000 HSD subscribers,” she said. “In the first quarter, our total revenue increased 1 percent from the same period last year to $286 million, driven by growth in our high-speed data business, which grew 12 percent year-over-year to $153 million, more than offsetting a decline in video and telephony revenue during the quarter.”

To keep up with the first quarter broadband earnings, make sure to check out our total broadband report: From AT&T to Shentel: Tracking the Top 17 Broadband Service Providers in Q1 2021.

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