Cable providers continue to threaten telcos

Cable operators have an insurmountable advantage over incumbent telcos, a market analyst contends. The reason: cable’s DOCSIS 3.1 technology enables gigabit speeds and cable operators now offer bundles that include wireless service, even though that service relies on Verizon Wireless’ network. “In addition to a lack of bundled offerings, the broadband speeds offered by the ILECs is in many cases far inferior to that of competing cable offerings,” Jefferies analyst Mark McCormack said.

Incumbent telcos investment in fiber hasn’t off-set their DSL subscription losses, and analysts think the trend may be too strong to reverse. “The time to play catch up has passed, given the time to market advantage that cable has, and we expect continued pressures from cable as DOCSIS 3.1 steps up the speed advantage that cable already enjoys,” a Jefferies analyst said.

Cable companies like Comcast and Time Warner now have about 62 percent of the broadband market, while incumbent telecos like AT&T, Verizon, CenturyLink, and Frontier share the remaining 38 percent of the market – 23 percent from fiber and 15 percent from DSL.

Links:

Cable has ILECs on the ropes, analyst says (FierceCable, Aug. 21, 2017)

AT&T, Verizon and Tier 2 telcos’ stocks threatened by cable’s broadband speeds, DOCSIS 3.1 migrations (FierceTelecom, Aug. 21, 2017)