As a nation we are approaching an 85% overall penetration of residential broadband. The following statistics come from the latest report from the Leichtman Group and compares broadband customers at the end of the recent 3Q of 2018 to the end of 2017.
|3Q 2018||4Q 2017||Change|
The large ISPs in the table control over 95% of the broadband market in the country. Not included in these numbers are the broadband customers served by the smaller ISPs – the telcos, WISPs, fiber overbuilders and municipalities. Cable companies continue to dominate the broadband market and now have 63.6 million customers compared to 34.0 million customers for the big telcos.
The 2.2% overall growth during the year is impressive since many have assumed that we are nearing the top of the market for broadband penetration. It’s worth noting that the US has had a housing construction boom and has added 1.6 million new housing units so far in 2018. If you assume those new homes share the same overall 85% market penetration as the rest of the country, the new homes would account for 1.36 million of the broadband gain. That means the rest of the market saw nearly a 1% overall increase in broadband penetration – a definite slowdown over prior years.
Much of the growth at the big cable companies continues to come at the expense of telco DSL. Overall, the big telcos lost a net of 328,370 customers for the year. This is mostly due to CenturyLink and Frontier, who are clearly bleeding DSL customers. The customer losses for these two companies is a bit surprising since by now each company should have activated big numbers of faster rural DSL customers, funded by the CAF II program. Companies are not required to report their performance for CAF II separately, and I have to wonder if many rural households are actually buying the improved rural broadband.
One thing that is clear about these numbers if that every company on the list ought to be considered now as an ISP, rather than as a telco or cable company. For this same 9-month period these same companies lost nearly 2.7 million cable customers while adding 2.1 million broadband customers. It’s clear that broadband is now the biggest and most important product for each of these companies.