It’s Early, But Comcast Optimistic About Xfinity Mobile

New service still poised to lower churn, become profitable part of the business, CFO says
xfinity mobile with phone.jpg

Comcast soft-launched Xfinity Mobile last week, and the MSO remains confident that the new offering will help the operator keep churn in check and become a profitable part of its business, company senior EVP and CFO Michael Cavanagh said Monday at the J.P. Morgan Tech, Media and Telecom Conference in Boston.

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Though too early to judge its performance, Comcast is "optimistic" that Xfinity Mobile, a service that leans on an MVNO deal with Verizon and Comcast’s WiFi network, will lower churn in its existing businesses, tighten ties with customers, and use economics “that can be stand-alone profitable,” Cavanagh said.

“Hopefully, it affects the arc of growth in the business. But time will tell,” he added, noting that Xfinity Mobile, which is being offered to Comcast’s high-speed Internet subs, will take advantage of the company’s 29 million customer relationships. “We'll do everything we can to leverage our existing business and assets, but we're going to walk before we run and learn as we go.”

In the early going, Comcast is offering a discounted unlimited Xfinity Mobile data plan for $45 per line (down from a regular price of $65). Comcast is also marketing a By the Gig plan that costs $12 per gigabyte per month. Xfinity Mobile customers are free to switch between those data options.

Cavanagh stuck to the script with respect to out-of-footprint video services, reiterating that the economics aren’t strong enough for Comcast to consider that strategy while also questioning the profitability of exiting OTT TV services.

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“We’ve been asked repeatedly why don’t we go out a footprint with a video-only product and we obviously see the benefit of bundling economics with other products we can deliver,” he said.

Today’s OTT players, he said, are coming out of the gate with business models that are in the break-even range while also facing the same long-term challenges that all MVPDs face – rising programming costs.

“We like our own game in terms of segmenting customers, providing a great video experience through X1, integrating Netflix, integrating YouTube, making it better and better as time passes, bundling it with broadband and providing a great value.”