Wireless Industry Supporters Missing 10 Million Customers (And They’re Ready to Lose More)

Wireless Industry Supporters Missing 10 Million Customers (And They’re Ready to Lose More)

Wireless Industry Supporters Missing 10 Million Customers (And They’re Ready to Lose More)

The last quarter was mostly strong for the country’s wireless industry. Verizon (VZ 0.24%) Only 8000 postpaid mobile customers, but AT&T (T 0.83%) And the T-Mobile (TMUS 0.45%) More than offset this weakness by adding 708,000 and 854,000 postpaid phone customers, respectively, to their revenue mix. Full-year growth is going well, and the three mobile operators are now operating collectively on the demand of 230 million postpaid phone customers. Add a few million prepaid and non-telephone accounts to this number.

But it’s a number that could have been (and should have been) more than 10 million customers. However, the craziest part of this deficiency is not its sheer size. What is crazy Why Industry supporters are 10 million shy of the number of potential customers. The competition that prevents the country’s three largest wireless service providers from attracting and retaining these customers is not actually focused on the mobile services side of the business. For those competitors, it’s currently just a side business.

Regardless, given how much these alternative providers continue to grow, it’s the competition that T-Mobile, Verizon, and AT&T can no longer ignore.

Do they provide wireless service?

As of the end of the third quarter of the calendar, Comcast (NASDAQ: CMCSA)And the Communication Charter (NASDAQ: CHTR)And the Altice USA (NYSE: HUNDRED) Collectively serving about 10 million wireless customers, up from none as of 2017.

Wireless Industry Supporters Missing 10 Million Customers (And They’re Ready to Lose More)

Data source: Comcast Corp. Charter Communications Inc. , Altice USA. Scheme by the author.

It’s strange for an obvious reason – these are organizations built from the ground up as cable TV service providers. They have all evolved into broadband companies, since the infrastructure that provides cable TV is well-suited to handling high-speed internet connections as well. As these communication networks have matured and modernized, they have also become well suited to handling mobile phones.

There are some technical obstacles to registration. Whereas traditional mobile service providers like Verizon and AT&T use networks from cell phone towers to deliver seamless connectivity wherever a customer travels, cable companies’ wireless communications rely heavily on physical infrastructure in the areas where their cable service is served. Outside of those geographies, they all have to hand those connections over to a traditional mobile carrier.

However, the growth in wireless cable customer numbers indicates that these deliveries are smooth enough.

The other limitation? Currently, however, except for Altice’s Optimum, broadband and cable TV providers only offer mobile service as part of a package that includes high-speed internet. Again, with “unlimited” plans often starting at $30 or less, it’s okay to pay for home broadband service from the same provider.

Too big to be ignored anymore

What started as a curious experiment with some of the best cable and broadband devices in the country, has evolved into so much more. However, it could still become a lot more than it is now.

Altice, Comcast’s Xfinity, and Charter’s Spectrum currently serve approximately 67 million high-speed Internet subscribers. Most are mobile-entitled, and many are multi-consumer residences who may prefer multi-customer family phone plans. Given how much traction these unexpected wireless services have already gained, it’s no exaggeration to suggest that this is the single biggest competitive threat Verizon, AT&T, and T-Mobile currently face. This is against the background of the current market saturation. Pew Research reports that 97% of American adults already own cell phones, most of which are smartphones.

So, connect the dots. The wireless market wasn’t really primed for growth. It is now more crowded as alternatives to traditional mobile service are available and viable. Although it’s not yet an explicit reason to sell any of them, interested investors may want to scroll all three stocks until it’s clear which — if any — will have an answer to this unlikely threat. It looks likely to come in an attractive form entertainment And call package instead of price cuts.

James Bromley He has positions at AT&T. The Motley Fool recommends Comcast, T-Mobile US, and Verizon Communications. Motley Fool has a profile Disclosure Policy.

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