Verizon Adds Q3 Broadband Subs, Loses Video

Verizon Oct. 20 revealed it lost 68,000 video subscribers in the third quarter (ended Sept. 30), to finish the period with 3.6 million Fios TV subs. That compared with a loss of 61,000 video subs in the previous-year period. Over the past nine months, Verizon has lost 212,000 pay-TV subs, down from 226,000 subs during the previous-year period. Year-over-year, Fios TV lost 284,000 subs.

Offsetting the pay-TV losses was broadband, the high-speed Internet required to deliver streaming video the “last mile” into consumer homes.

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Verizon, along with Comcast, AT&T and others, is one of the largest ISPs in the country. The telecom said it added 98,000 broadband subs in the quarter, down from 139,000 additions in the previous-year period. The company ended the period with almost 6.5 million broadband subs, up from 6.1 million last year. Over the past nine months, Verizon has added 288,000 high-speed Internet subs, compared with a gain of 208,000 subs during the previous-year period.

“We are seeing strong demand for connectivity across our consumer and business segments as our … network quality and unique partnerships are resonating with both new and existing customers,” chief financial officer Matt Ellis said in a statement.

Data: Pay-TV Providers in Q2 Lost 1.2 Million Video Subs, Added 890K Broadband

As pay-TV operators continue to hemorrhage video subscribers to over-the-top video, losses are being offset by broadband service additions — a requisite for streaming video distribution.

New data from Leichtman Research Group found that the largest pay-TV providers in the U.S. — representing about 95% of the market — lost more than 1.2 million net video subs in 2Q 2021, compared with a net loss of about 1.5 million subs in the previous-year period.

Pay-TV operators added 890,000 net broadband internet subscribers in the quarter; 8 million net adds over the past two years.

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The top pay-TV providers account for about 77.6 million subs — with the top seven cable companies having 42.6 million video subs, other traditional pay-TV services having about 28.2 million subs, and the top publicly reporting online TV services having about 6.8 million subs.

Leichtman found that the top cable providers had a net loss of about 590,000 video subs in 2Q 2021 — compared to a loss of about 505,000 subs in 2Q 2020. Other traditional pay-TV services had a net loss of about 700,000 subs in 2Q 2021 — compared with a loss of about 1,045,000 subs in 2Q 2020.

AT&T led all pay-TV services with 473,000 net sub loss, an improvement compared with 887,000 net losses in 2Q 2020. Online TV services, led by Sling TV, YouTube TV and Hulu + Live TV, added 55,000 subs, compared to a gain of about 45,000 subs last year.

“Pay-TV net losses were about 275,000 fewer than [last year] on a pro forma basis,” analyst Bruce Leichtman said in a statement. “Over the past year, pay-TV providers had a net loss of about 4.52 million subs, compared to a loss of about 5.4over the prior year.”

Separately, Leichtman said the quarterly broadband additions were the most in any second quarter in the past decade, except for 2Q 2020.

“Pay-TV operators have added about 3.67 million net broadband adds over the prior year,” he said.

Comcast Cable Q2 Sub Loss Cools, Broadband Gain Skyrockets

As expected, Comcast Cable, the nation’s largest pay-TV operator, saw continued consumer migration away from linear television to over-the-top video distribution. The cabler said it lost 399,000 residential and business video subscribers in the second quarter, ended June 30, to finish the period with more than 18.9 million subs. That compared with a sub loss of 477,000 during the previous-year period, ending at 20.3 million total subs.

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Year-to-date sub losses top 889,000, which is par with 887,000 sub loss in the previous-year period.

On the flip side, Comcast added 354,000 high-speed Internet subs, ending the quarter with 31.3 million subs. That compared with a gain of 323,000 subs and 29.4 million broadband subs in the previous-year period. Year-to-date, Comcast has added 814,000 broadband subs compared with 800,000 additions last year.

Cable revenue increased 14.5% to $7.1 billion in the quarter of 2021, reflecting higher revenue, partially offset by an 8.2% increase in operating expenses largely due to the return of live sports events.

“At cable, our performance was exceptional, highlighted by 11% revenue and 15% [adjusted pre-tax earnings] growth, the best broadband and total customer relationship net additions on record for a second quarter,” Comcast CEO Brian Roberts said in a statement.

Verizon: Fios TV Q2 Subs Down, Broadband Up

Verizon July 21 disclosed that while its legacy Fios TV service continues to lose pay-TV subscribers, the losses are more than offset by increases in high-speed internet subscriptions — gateways for third-party over-the-top video distribution into homes.

Verizon has no branded streaming service, but it is offering select mobile customers upwards of 12 months free access to Disney+ and Discovery+.

Fios TV ended the second quarter (ended June 30) with more than 3.7 million subscribers, which was down 270,000 subs from the previous-year period. In the quarter, Verizon lost 62,000 net subs compared with a loss of 81,000 subs last year.

At the same time, Fios broadband ended the period with almost 6.4 million high-speed Internet subs, up 421,000 subs from the previous year period. In the quarter, Fios added 92,000 broadband subs, compared with 10,000 net additions last year.

“The strength in our core business is driving higher revenues and strong demand for our products and services,” CFO Matt Ellis said in a statement. “We delivered strong operational and financial performance, giving us positive momentum as we end the first quarter. High-quality, sustainable wireless service revenue growth, a recovery in wireless equipment revenues, strong Fios momentum and excellent Verizon Media trends led the way.”

Parks: Apartment Residents Want Broadband Included in Rent

With increased dependency on high-speed internet service, new data from Parks Associates finds that 40% of survey U.S. respondents who live in multi-dwelling apartments (MDU) are interested in bulk broadband internet bundled with their rent — and 77% of those are willing to pay higher rent in exchange for these services.

Dallas-based Parks firm also tracked growing ownership in smart home devices among MDU residents, with 41% of all broadband households owning at least one smart home device, compared with 34% of single-family households.

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“Consumers need broadband to live, work, learn, shop, and connect to healthcare, banking and more,” Jennifer Kent, VP of research at Parks Associates, said in a statement. “Social distancing during the COVID-19 pandemic has revealed consumer dependence on reliable connectivity and high-speed access, as it is the foundation for access to and quality of connected services like telehealth, video conferencing, and online fitness solutions to meet their daily needs.”

High smart home device adoption among MDU residents correlates with age. Consumers 25 to 34 years old are among those more likely to adopt smart home devices, and they are also the most likely to live in a multi-dwelling unit.

Building on a high-performing broadband backbone, Parks suggests MDU property managers can leverage connected devices and smart platforms that integrate connected solutions to streamline property management tasks and lower operating costs, attract and retain residents, and increase rental revenues. Sixty-five percent of MDU builders report their business model leverages smart home technology to differentiate properties and add value.

“Today’s homes are dependent on technology and connectivity, and this requires a strong need for consultative engagement for MDU developers and managers,” said Vickie Rodgers, VP of Cox Communities. “From optimizing operational efficiencies, connectivity solutions, cloud-based services, device choices and integration, smart homes don’t work without great broadband connections and the appropriate integration.”

Report: 1 Million U.S. Homes Added Broadband in Q1, Down From 2020

The nation’s top multichannel video providers may be losing subscribers to over-the-top video distribution, but the same providers are also the top ISPs — delivering the broadband required to stream Netflix, Disney+ and Amazon Prime Video into homes.

New data from Leichtman Research found that the largest cable and telecom providers in the U.S. — representing about 96% of the market — acquired more than 1 million net broadband subscribers in 1Q 2021 — down 13% from a gain of about 1.17 million subs in 1Q 2020.

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The broadband providers now account for about 107 million subs, with cable companies having about 73.7 million broadband subs, telecoms having about 33.3 million subscribers.

The top cable companies added about 935,000 subs in 1Q 2021 — 76% of the net additions for the top cable companies in 1Q 2020. Telecoms added about 85,000 total broadband subs in 1Q 2021 — compared with a net loss of about 60,000 subs in 1Q 2020

Net broadband losses among non-fiber telecom subs were more than offset by gains of more than 400,000 net fiber subs, bringing the number of telecom fiber broadband subs to about 14.6 million.

“This broadband growth marked the fourth time in the past five quarters that there were more than one million net broadband additions in the U.S.,” analyst Bruce Leichtman said in a statement. “Over the past year, there were about 4.66 million net broadband adds, compared to about 2.76 million net broadband adds over the prior year.”

Broadband Providers Subscribers at end of 1Q 2021 Net Adds in 1Q 2021
Cable Companies
Comcast 31 million 460,000
Charter 29.2 million 355,000
Cox 5.4 million 55,000
Altice 4.4 million 11,600
Mediacom 1.5 million 16,000
Cable One 880,000 23,000
WOW (Wide Open West) 823,800 10,000
Atlantic Broadband 511,004 6,383
Total Top Cable 73.7 million 936,983
Wireline Phone Companies
AT&T 15.4 million 51,000
Verizon 7.2 million 64,000
CenturyLink/Lumen^ 4.7 million (39,000)
Frontier 3 million (17,000)
Windstream 1.12 million 13,000
Consolidated 794,224 2,024
TDS 501,700 8,400
Cincinnati Bell 437,600 1,500
Total Top Telco 33.3 million 83,924
Total Top Broadband 107 million 1.02 million

Parks: Lower Smart Home Device Pricing Could Add Broadband Households

A new industry report from Parks Associates reveals that among the 42% of U.S. broadband households who do not own and do not plan to buy a smart home device, 17% admit they would likely buy a device if the cost were lower. Capturing these consumers at the right price point would add 7.9 million more households to the population of smart home owners.

Smart home devices include appliances, thermostats, lights, alarms, doorbells, cameras, televisions, Blu-ray Disc players, sound bars and voice-activated speakers, among other devices.

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In Parks’ Q4 2020 survey, affordability of smart home devices ranks as the most important purchase consideration among purchase intenders. Discounting product prices and bundling products in ways that strengthen value are critical strategies to attract the majority of consumers who rank affordability in their top three purchase considerations. Bundling of smart home devices such as smart plugs, smart light bulbs, or smart thermostats with a smart speaker can introduce the smart home experience to consumers through a leading entertainment device that can be used to stream music and control smart home functions, according to Parks.

More than 50% of U.S. broadband households that do not own or intend to purchase a smart home device, report they do not see any benefits to smart home ownership, although this attitude is more prevalent among older consumers.

“Messaging that highlights strong product value helps overcome price sensitivity and counters the perceived lack of a viable value proposition,” analyst Patrice Samuels said in a statement. “Familiarity with devices is increasing, but value perception is not. Brands must emphasize pragmatic value propositions such as energy savings, loss prevention, and safety to persuade the broad swatch of broadband households that do not see any benefit or value in owning smart home devices.”

Comcast Loses 491,000 Pay-TV Subs in 90 Days, Expects ‘Elevated’ Sub Losses in Q2

Comcast Cable April 29 reported it lost 491,000 pay-TV subscribers in the first quarter (ended March 31). The tally, which included 87,000 business subscribers, topped the previous-year period loss of 409,000 subscribers. Comcast ended the quarter with 19.3 million subs — down 1.5 million subs from the same period in 2020.

The nation’s largest cable operator attributed the subscriber losses to ongoing consumer shifts to over-the-top video distribution — a trend that isn’t slowing down.

“We expect video losses in the second quarter [ended June 30] will remain elevated,” CEO Mike Cavanagh said on the fiscal call.

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That transition has become a boon to Comcast’s high-speed Internet business, a pre-requisite for streaming video. As one of the largest ISPs in the country, Comcast added 461,000 broadband subs, which was actually down from 477,000 additions in the previous-year period. The tally includes business subscribers.

Notably, video revenue of $5.6 billion was consistent with the prior-year period, reflecting a decrease in the number of residential video customers offset by an increase in average subscriber rates.

Report: Pandemic Drove 4.9 Million Broadband Additions Among Top ISPs in 2020

With more consumers housebound due to the pandemic, subscriptions for high-speed Internet, or broadband, grew significantly, according to new data from Leichtman Research Group. The Durham, N.H.-based firm found that the largest cable and wireline phone providers in the U.S. — representing about 96% of the market — acquired more than 4.8 million net additional broadband Internet subscribers in 2020, compared with a gain of about 2.55 million subs in 2019.

The following broadband providers now account for 105.8 million subs, with cable companies accounting for 72.8 million broadband subs, and telecoms having 33 million subs.

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Overall, broadband additions in 2020 were 190% higher than in 2019, and more than in any year since 2008. Cable companies added about 4.82 million subs compared to 3.15 million adds in 2019, and the most in any year since 2006.

Charter’s 2.21 million broadband additions were more than any company had in a year since 2006. Telecoms added about 40,000 subs compared to a loss of about 590,000 subs in 2019. The industry had positive net annual broadband adds for the first time since 2014. At the end of 2020, cable had a 69% market share vs. 31% for telecoms.

“With the impact of the pandemic, there were more net broadband additions in 2020 than in any year since 2008,” analyst Bruce Leichtman said in a statement. “The top cable and telecom providers in the U.S. cumulatively added about 4.86 million subs in 2020, compared to about 5.1 million subs in 2018 and 2019 combined.”

Broadband Providers Subscribers at end of 4Q 2020 Net Adds in 2020
Cable Companies
Comcast 30.6 million 1.97 million
Charter 28.9 million 2.21 million
Cox 5.38 million 210,000
Altice 4.36 million 142,200
Mediacom 1.43 million 110,000
Cable One 857,000 101,000
WOW 813,800 32,300
Atlantic Broadband 504,621 37,871
Total Top Cable 72.8 million 4.82 million
AT&T 15.4 million (5,000)
Verizon 7.12 million 173,000
CenturyLink/Lumen 4.54 million (134,000)
Frontier 3.1 million (111,000)
Windstream 1.1 million 60,000
Consolidated 792,200 8,035
TDS 493,300 38,100
Cincinnati Bell 436,100 10,400
Total Telecom 32.9 million 39,535
Total Broadband 105.8 million 4.85 million
Sources: The Companies and Leichtman Research Group, Inc.

Parks: More Than 12 Million U.S. Households Have Cut Broadband Service

Parks Associates reported that more than 12 million U.S. households have canceled their home broadband service and use only mobile broadband for their Internet needs. The Dallas-based research firm finds there are more than 15 million domestic households that have only a mobile broadband service, which includes more than three million households that have never had home high-speed Internet service.

The finding is noteworthy since high-speed Internet access is key to over-the-top video consumption, and mobile broadband service providers cap user data at a far lower rate than traditional ISPs. Indeed, Comcast, arguably the largest broadband provider in the country, added two million high-speed subscribers in 2020.

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“High cost is the most prominent issue driving households to cut the cord and go mobile only, although service-related issues, from slow speeds to poor customer experience, also contribute,” analyst Kristen Hanich said in a statement.

Currently 94% of all U.S. broadband households use Wi-Fi networking at home, and more than half report problems with their Internet. Parks found that “smart Wi-Fi,” or mesh networking products that would improve Wi-Fi coverage are powerful incentives to staunch churn, as 75% of households likely to switch would stay with their current provider if offered these solutions.

The study said broadband ability to deliver the necessary speeds are more critical now as 41% of broadband households were engaged in remote work or remote schooling. The increase in at-home activity has renewed consumers’ focus on their broadband speeds.

“In September 2020, 9% of broadband households had upgraded their home’s broadband service in the previous 12 months, and the COVID-19 crisis was the main reason for 80% of those upgrades,” Hanich said.