7957e52d44b0445e63e3959104f0455249088fe0 Injection University America’s Two Biggest Cable Broadband Monopolies Failed To Add Any New Customers Last Quarter | Tech Power

America’s Two Biggest Cable Broadband Monopolies Failed To Add Any New Customers Last Quarter

from the do-not-pass-go,-do-not-collect-$200 dept

Mon, Aug 8th 2022 05:27am - Karl Bode

Roughly 83 million Americans currently live under a broadband monopoly. In most instances, their only choice is Comcast or Charter Communications, which sells service under the “Spectrum” brand. And in both cases, users pay significantly higher prices for spotty, slow, service with statistically terrible customer service, because that’s how monopolization works.

But the nation’s two biggest cable companies are having a rough year so far.

Comcast, for example, has not only lost more than a million traditional pay TV subscribers so far this year, last quarter the company failed to add any new broadband subscribers for the first time in company history. Now Charter has followed suit, not only losing 226,000 pay TV subscribers last quarter, but losing 42,000 broadband customers as well.

Charter blames the end of a $50 a month COVID-relief broadband subsidy program (which didn’t really end, it was just made permanent via the infrastructure bill and renamed):

“During the second quarter, we added 38,000 Internet customers when excluding an unfavorable impact related to the discontinuation of the Emergency Broadband Benefit program and additional definitional requirements of the Affordable Connectivity Program,” Charter CEO Thomas Rutledge said in a call with analysts, according to a Seeking Alpha transcript.

But Charter’s broadband losses likely would have happened earlier if not for the COVID subsidy program, which effectively advertised the company’s service to low-income Americans. And there’s several contributing factors to the shift.

One, companies like Charter and Comcast are starting to see more competition from 5G fixed wireless, and low-orbit satellite services. Though folks shouldn’t make too much of said competition; Starlink for example has a maximum total capacity of 800,000 or so total global users, and will hardly put much of a dent in the 83 million monopoly total. And while fixed 5G will grow, wireless, in general, still comes with network limits not seen on superior broadband options like fiber.

But the primary reason for the slowdown is the broadband market is simply becoming saturated. Cable giants aren’t really willing to expand broadband into higher ROI rural and urban areas, and everybody already has access in the markets they serve. As a result, these companies just aren’t seeing the same kind of growth they’re used to.

Both Charter and Comcast are hopeful that some of this can be remedied by the historic infusion of more than $50 billion in broadband subsidies now arriving courtesy of COVID relief and the new infrastructure bill (which, ironically, they lobbied against). That money is being distributed by the FCC and NTIA to the states, which then have to develop systems determining how the money is spent.

As a result, lobbyists for both companies are working overtime convincing numerous states to pass laws literally banning some of this funding from going to any competitors. At the same time, they’re also trying to challenge community broadband and local competitor grant applications, using flawed FCC data to falsely claim they already provide service to these targeted areas.

In short, these monopolies are hopeful that any future growth comes from elbowing out others at an historic trough of new subsidies. And given the level of state and federal corruption in terms of telecom policy here in the States, I have little doubt they’ll be fairly successful at it. But here too there’s a limit; somewhere between 20 and 40 million Americans remained unserved.

As the growth opportunities tighten, these monopolies will do what they’ve always done: turn toward pleasing Wall Street by nickel-and-diming the subscribers they already have, while simultaneously fighting tooth and nail to crush any new competitors that might threaten their dominance in any real way.

Filed Under: broadband, broadband monopolies, competition, covid relief, digital divide, high speed internet, saturated market, subsidies Companies: charter, charter spectrum, comcast

Source: https://www.techdirt.com/2022/08/08/americas-two-biggest-cable-broadband-monopolies-failed-to-add-any-new-customers-last-quarter/