Cable's Mobile Push Not Seen Carrying Spectrum Demand

While the lineup of cable operators providing mobile service grows, with others likely to follow, most will rely on mobile virtual network operators and their own Wi-Fi networks to provide the service rather than become more active in acquiring spectrum for their own wireless networks, wireless and cable experts tell us.

Numerous ACA Connects members are thinking about the need for a mobile component, President Grant Spellmeyer said. If NCTC is able to negotiate a deal for purchasing mobile carriage the way it does for video services, numerous ACA members would likely sign on, he said. Building their own wireless networks seems less in the cards. Spellmeyer said a big hurdle is the lack of a clear pipeline of new spectrum that would make it economical to undertake a facilities-based offering.

A Cox Communications spokesperson declined to talk about its spectrum auction plans. He said Verizon is the MVNO partner for the Cox Mobile service unveiled at CES this month (see 2301050072) and that Cox will use that and Wi-Fi offload to support the consumer cellular service.

Charter Communications has indicated it plans to move some of its Spectrum Mobile traffic onto its own citizens broadband radio service network, which is why it bought CBRS spectrum, said Recon Analytics’ Roger Entner. Comcast is likely to do something similar with its own for Xfinity Mobile, he said. Cox tried to build its own wireless network once before and eventually pulled the plug, and it isn't likely to try that again, he said. He said Altice isn't likely to buy much spectrum for Altice Mobile use.

Charter's buildout will likely focus on areas of the highest density and most traffic, where return on that investment is greatest, Entner said. Those economics are also why most regional cable operators, if they get into mobile, will rely on MVNOs and Wi-Fi, he said.

Charter CEO Chris Winfrey said in an investor presentation last month (see 2212140047) that 85% of Spectrum Mobile traffic is now carried via Wi-Fi and 15% via MVNO, but the company expects its 5G CBRS mobile network will carry 5% of the overall traffic by 2025, reducing the MVNO's portion to 10%. He said Charter will double the number of Spectrum Mobile access points to 50 million during the same span.

Comcast and Charter seemingly want to offload more mobile traffic onto their CBRS licenses, but they don't seem to be aggressively doing so, said Sasha Javid, BitPath chief operating officer. He said Cox would likely want to do the same, using its own CBRS licenses, but it's apparently slower out of the gate to launch its mobile service. Whether Altice is active in future spectrum auctions could depend on license sizes and geographies available, plus how its mobile base is growing, he said. Smaller cable operators are going to face big expense challenges if they want to buy spectrum, on top of the expenses and expertise needed to run a wireless network, he said.

Being a reseller of services provided by one of the major national carriers might not be profitable for a cable company, but there's still a benefit in offering mobile coverage because of how sticky it makes the cable company to subscribers, said wireless consultant Jeff Kagan. "At worst, it's a way of locking in the customer so you can be profitable selling your other services" such as broadband, he said. Given the expense involved, not all cable operators will go the mobile route, Kagan said.

For the major wireless carriers, there are few downsides to MVNO agreements, Kagan said. They provide wholesale revenue, and their own retail subscribers always get preferred access, he said. If a tower is experiencing heavy traffic, MVNO customers can end up blocked, which is why resellers can have problems having their customers access data in certain locations at certain times of day, he said.