Altice USA is looking to level the playing field as it battles Verizon in the New York metropolitan area, plotting the launch of a new Optimum Mobile offering which will allow it to match its rival’s double play bundle.
Speaking on the operator’s Q3 earnings call, CEO Dexter Goei noted Altice has been feeling the heat from Verizon in areas where its Optimum products compete with the latter’s Fios brand. He attributed Verizon’s advantage in part to its ability to package strong fixed and mobile products together.
“They obviously have a mobile strategy and product and mind share which is significantly higher than ours across the board,” he explained. “And they’re extremely promotional on double playing both their fixed and mobile offerings together, something that we have not been able to do historically, one, because we had an inferior product with the Sprint network but also because as we were focused on our product portfolio the double play portfolio…was less of a focus.”
But the situation is changing, with Optimum Mobile now riding on T-Mobile’s network and Altice planning to completely blanket areas of Fios overlap with 10 gig-capable fiber by the end of 2023 to strengthen its broadband product as well.
“We’ll have something to show the market in the first quarter of next year,” Goei said, referring to a new “converged” mobile offer.
Last month, Altice USA took initial steps to make it easier for subscribers to bundle broadband, mobile and TV services. Goei previously indicated the operator would ramp marketing around its mobile product in Q4 2021.
In Q3, Altice added 1,000 mobile lines, compared to 18,000 in the year-ago quarter, increasing its total year on year from 162,000 to 181,000. The business generated $19.7 million in revenue during the quarter.
Cable MVNO Q3 roundup
Altice and the two other major U.S. MVNO players Comcast and Charter Communications (both of which use Verizon’s network) collectively gained 530,000 mobile subscribers in Q3. All told, the cable trio ended the quarter with 7.03 million mobile customers, marking a substantial increase from a total of 4.82 million in Q3 2020.
Comcast’s Xfinity Mobile set a new record with 285,000 net additions, compared to 187,000 in the year-ago quarter, with executives highlighting the latest figure as the most it’s ever gained in any quarter since the service launched in 2017. It ended the quarter with 3.67 million mobile customers. Wireless revenue jumped 50.7% year on year to $603 million.
Speaking about the business on its Q3 earnings call, Comcast Cable CEO David Watson stated “we really haven't changed our strategic imperative behind mobile. But most certainly, things have accelerated.” He added the company’s goal “is to go faster and leverage mobile completely in everything that we do and how we surround broadband with a terrific product. I think it is profitable. It'll continue to be. I feel confident of that.”
Charter wasn’t too far behind in terms of net additions, with its Spectrum Mobile brand pulling in 244,000 to end the quarter with a total of 3.2 million lines. The net add figure was down year on year from 363,000. Mobile revenue increased 45.4% to $535 million.
During its earnings call, CEO Tom Rutledge said it planned to launch a field trial using CBRS spectrum (3.5GHz) in a full market area in early 2022, allowing trial participants to connect to “thousands” of small cells when they are outside of Wi-Fi coverage.
Today “80% of the traffic on mobile platforms is on Wi-Fi,” he said. Adding CBRS to the mix offers “an opportunity to make a significant change in how much traffic is on our network versus on the MVNO.”
Rutledge continued: “You're talking years of runway necessary to deploy that and to get it fully utilized, but the good thing about it is that the capital associated with any construction we do is dedicated to a lower cost.”
The CEO previously stated in Q2 Charter doesn’t anticipate achieving “any meaningful national offload” until the beginning of 2023.