Editor's Corner—Comcast Xfinity Mobile is a no-frills MVNO service primarily designed to prevent churn

Comcast offers several phones for Xfinity Mobile. (Comcast)

Comcast today unveiled some details about its forthcoming mobile service, most notably that it will cost $45 per month. However, that’s a price that will only be available to the company’s best customers. Customers who don’t subscribe to Comcast’s most expensive internet and TV bundles will pay $65 per month for its Xfinity Mobile unlimited data service.

Comcast customers will also have the alternative option to buy wireless data at $12 per GB.

Importantly, Comcast Xfinity Mobile is only available to the cable company’s existing subscribers. Comcast touts 29 million customer relationships and 130 million potential mobile lines of service. Comcast’s offering runs over Verizon’s wireless network and stems from a deal that Comcast and other cable operators inked with Verizon in 2012 as part of Verizon’s $3.9 billion purchase of their AWS spectrum. Charter has also hinted that it too may activate its MVNO option through Verizon.

Aside from its pricing, Comcast is also offering a few noteworthy mobile services, including the ability to autoconnect to Comcast’s 16 million public Wi-Fi hotspots. The company is also offering customer service via text message, meaning customers will be able to text customer support directly from the phone’s native text app and won’t have to do it from inside Comcast’s customer service app.

Other caveats to the service: “Unlimited” data will be slowed after 20 GB of usage in a month, but that throttling will only go down to 1.5 Mbps, as the WSJ noted, and not the industry standard of 128 Kbps. Also, voice over Wi-Fi won’t be supported, meaning that customers will still need a cellular signal to make voice calls when they’re on Comcast Xfinity hotspots. And Comcast won’t allow customers to bring their own devices to the service, which means customers will have to buy one of the Apple, Samsung or LG phones that Comcast sells for the service. Interestingly, Comcast will offer equipment installment pricing options for those phones, which spread the cost of the phone across 24 monthly, interest-free payments.

“It will be designed to support the core cable business,” Comcast Cable CEO Dave Watson explained on a conference call today with investors. “We have a good value proposition.”

Greg Butz, the head of Comcast Mobile, said that the business is primarily geared toward making Comcast’s offerings more sticky. “We have a really efficient business model. We are going to take the benefits of that efficient business model, and we are going to pass them along in the form of savings to our customers,” he said on the company’s conference call. “If it helps us improve loyalty, if it helps us drive customer growth, if it lifts the overall lifetime economics of that relationship, that’s a good business decision.”

And Comcast CFO Michael Cavanagh said the company’s new mobile service should help it “sustain better growth,” noting that last year Comcast managed for the first time in years to grow the number of its pay-TV subscribers.

Indeed, Comcast’s Xfinity Mobile pricing does put the company on relatively solid competitive footing. Sprint just today reduced the cost of its unlimited service to $50 for a single line of service, which puts Comcast’s offer just below the cheapest of the nation’s Tier 1 carriers. T-Mobile’s unlimited service clocks in at $70 per month, while Verizon charges $80 and AT&T charges $90 per month for a single line of service. (AT&T also has a $60-per-month option, but speeds on that service are capped at 3 Mbps.)

Thus, Comcast’s MVNO does give the company surprisingly competitive pricing, which is noteworthy considering Xfinity Mobile runs on Verizon’s own LTE network. Comcast executives explained that the company was able to eke out a favorable MVNO pricing deal from Verizon because of the AWS spectrum they were able to offer to Verizon; Verizon has since used that AWS spectrum to reinforce its LTE network. (The company branded its AWS spectrum as XLTE in 2014.) Typically, MVNOs aren’t able to obtain wholesale access to LTE networks at rates at or below those of the host carrier.

But, to be clear, Comcast’s Xfinity Mobile service isn’t a mass-market play. It’s only available to existing customers, which means that it’s primarily intended to prevent Comcast customers from leaving the operator in search of better pay-TV and wireless offerings. For example, AT&T today offers a $25 monthly discount to its Unlimited Plus wireless customers who also sign up for its DirecTV or DirecTV Now services. That could represent a threat to Comcast if there are any Comcast pay-TV customers who get their smartphones from AT&T. Now, though, Comcast can shut the door on AT&T’s encroachment by getting those customers to sign up for its $45 unlimited wireless service.

Comcast’s Xfinity Mobile service doesn’t really offer any new, fancy services. There’s no free international roaming, like what T-Mobile offers. There’s no free HBO, like what AT&T launched this week. There aren’t any devices capable of 200 Mbps speeds, like what Sprint has sometimes touted. But what Comcast’s Xfinity Mobile does offer is the opportunity for Comcast to more closely tie its customers to its Xfinity services—and to prevent the likes of AT&T or Verizon from getting a foot in the door. —Mike | @mikeddano