Cable company Altice won’t launch its wireless service until 2019

Altice USA's footprint
Altice offers cable service in a number of U.S. states. (Altice)

Altice’s top management said the cable company is working on a core network for its forthcoming Sprint-powered wireless service, but the company won’t launch the service commercially until next year.

“We are commencing the core network development now in 2018 with a commercial launch planned by 2019,” Altice’s Dexter Goei said during the company’s quarterly conference call with investors, according to a Seeking Alpha transcript of the event. “This will be a new area of growth for us and we can leverage expertise in the Altice group and how to position this to our customers within bundles to help reduce churn and drive ARPU.”

When Altice and Sprint first announced their MVNO teaming in November, Altice didn’t provide a timeline for its planned launch of the Sprint-powered wireless service. However, the fact that the company won’t launch the offering for at least another year indicates it doesn’t feel much pressure to enter the wireless market immediately.

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Moreover, Altice’s yearlong development cycle dovetails with the MVNO launch timelines kept by its fellow cable providers Comcast and Charter Communications. Comcast, for instance, said it activated its MVNO agreement with Verizon in 2015 but didn’t launch the offering commercially until the summer of 2017. Charter, similarly, activated its own MVNO with Verizon in 2016 and has said it will launch the offering commercially in June or July of this year.

Altice’s 2019 wireless launch date will likely coincide with Sprint’s launch of nationwide 5G services, which the carrier promised will happen in the first half of next year.

So far, Comcast’s Xfinity Mobile offers the only real indication of what cable operators might do in the wireless industry. Comcast’s wireless service is only available in the company’s cable footprint, and it offers unlimited data service for $45 per month or 1 GB of data for $12 per month. The service also defaults to Comcast’s Wi-Fi hotspots when they are available, thus limiting the amount of time customers stay on Verizon’s LTE network.

Comcast in its most recent quarter said it added 250,000 wireless subscribers over the first four months of its MVNO launch (and 187,000 net line additions in the fourth quarter), and investors believe the cable giant is on track to add more than 1 million wireless subscribers for the full-year 2018. However, the company spent roughly $1,260 per customer to acquire those subscribers.

Comcast’s Xfinity Mobile is “very irrelevant, and I assume that [Charter’s soon-to-launch mobile service] will be irrelevant squared,” T-Mobile CEO John Legere said this month in response to Comcast’s wireless progress. “The furthest thing from my mind is any concern about the impact of cable.”

Altice joins a number of other MVNOs on Sprint’s network, including Wing, Ting and others. But Altice’s deal with Sprint is unique in that Altice has agreed to give Sprint access to its wired network for backhaul for Sprint’s small cells.