Analyst: U.S. Telcos May Never Generate Fixed-Data Sub Growth Again

Doesn’t view 5G as ‘credible threat to cable’
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As U.S. cable operators continue to dominate broadband sub growth and ratchet up Internet speeds with technologies such as DOCSIS 3.1, the nation’s telcos will be hard-pressed to ever achieve positive net fixed data sub growth again, an industry analyst predicted. 

U.S. cable operators raked in 830,000 net broadband subs in Q3, while the telcos lost 135,000 net subs in the period, Jeffrey Wlodarczak, principal and senior analyst, media & communications at Pivotal Research Group, said in a research note issued Monday.

Cable’s adds were down 5% year-on-year, though in-line with Pivotal’s forecast, while the telcos lose more than the 115,000 that the firm was expecting.

“With cable aggressively ramping their speeds (boosted by the widespread rollout of DOCSIS 3.1 technology [and its promise of widespread 1 gig + download speeds]) it is a reasonable assumption that the telcos may never generate positive net fixed data subscriber growth again, Wlodarczak.

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He added that 5G wireless, viewed as a potential fiber alternative, is not currently viewed “as a credible threat to cable,” thought it could become a technology that can aid in certain market segments, such as multiple dwelling units, “and “may be able to get a medium to long term foothold.”

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Wlodarczak also suggested that the “likely elimination of Title II regs” under a Trump administration could also alleviate the medium and long-term regulatory risk for the cable industry.

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