Cable companies muscle in on mobile – flexibility key

Cable companies like Comcast, Charter, and Altice are growing their share of the American mobile phone market reflecting increased competition often based on giving users flexibility over their plans that has become a key aspect of successful service businesses in the pandemic.

Why it matters

The Wall Street Journal’s report on the rise of cable firm’s mobile businesses reflects the reality of these TV, Wi-Fi and landline providers struggling to keep customers on their books. However, with a lot of mobile browsing (around 60%) now done on Wi-Fi at home, cable firms are at slight advantage to wireless carriers who they can undercut. But flexibility  - one interviewee changes his allowance monthly depending on what he will use – is likely to be a key hangover from the pandemic, even in low-cost travel, auto, and now cellular, where the terms of competition have changed.

Details

• Cable companies are now looking to garner profits from their mobile businesses.
• While the scale of wireless carriers is nearly 50 times that of cable firms’ mobile businesses, they are being undercut by half in some cases.
• Still, market share remains in single figures and any significant gains will ultimately lead to large infrastructure costs.

Bottom line

With five million Americans now buying their mobile allowances from cable companies, following relatively young investments (the oldest, Comcast, began a mobile business in 2017), convenience is clearly important but how the cable firm’s fare as lockdowns ease will be key.

Sourced from the Wall Street Journal, WARC