Charter Adds 276K Spectrum Mobile Lines in Q3

Cable operator up to 794,000 ‘ARPU generating units’ as it weighs schemes, including CBRS, to offload MVNO traffic
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Charter’s Spectrum Mobile product added 276,000 lines of service in the third quarter, giving the wireless offering around 794,000 customer lines after only around 15 months on the market.

Spectrum Mobile, which is based combines Wi-Fi and an MVNO wholesale agreement with Verizon, generated 208,000 lines in the second quarter.

The service generated $192 million in revenue in Q3 vs. expenses of $337 million, for a total loss of $145 million in the quarter.

During Charter Communications’ Q3 call Friday, company Chairman and CEO Tom Rutledge was asked recent speculation that Charter might use technologies including CBRS and dual-SIM to move traffic off the Verizon network, thus making their respective mobile offerings far more profitable.

“We’ve talked about dual SIM technology opportunities and the testing that we've done, and we're quite optimistic about the capability of that strategy,” Rutledge said. “We’re quite optimistic about the ability to make select investments in areas where traffic dictates in such a way as to move services that we pay rent for on to our own platform and that opportunity already exists with Wi-Fi and a significant number of our customers.”

According to Rutledge, 80% of data used on Spectrum Mobile is transmitted via Wi-Fi.

If Charter could offload anything close to half the cost of monthly service onto its own network, "it would be a game-changer," said MoffettNathanson principal analyst Craig Moffett. 

“We think there's continued opportunity to move traffic that way, and we've experimented with a bunch of methodologies to do that and CBRS does work very well,” Rutledge said. “And as you know there's a significant amount of free CBRS spectrum available which we've been using. We've also done some experiments with that spectrum with fixed wireless connectivity. We've got an experiment going with that too and actual live customers going in rural low density areas. So it's a pretty valuable piece of spectrum. There's some private spectrum of CBRS that's going to be auction next year. The question we're evaluating is should we be involved in that. But we haven't determined that yet but we're looking at it closely.”

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