Tag Archives: Comcast

A Converged Carrier Market?

T-Mobile made financial news recently when a KeyBanc Capital Markets analyst downgraded the long-term outlook for T-Mobile stock and said the company is “underweight”. Press coverage quoted the analyst saying, “We think [T-Mobile] is fiber deficient in a converged/bundled world”.

We’ve been headed towards the industry that is dominated by a handful of converged telecom providers, and the comments from this analyst show that day is probably here. The analyst’s comments come from comparing T-Mobile with the other giant converged companies that offer broadband and wireless, specifically AT&T, Verizon, Comcast, and Charter/Cox.

It’s curious why the analyst dinged T-Mobile because the company is profitable and successful. In the latest financial report for the second quarter of 2025, the company reported $17.4 billion in customer revenues, up 6% year-over-year. Net income was $3.2 billion, the highest-ever for the company and up 10% year-over-year. Net cash from operations was $7 billion, up 27% year-over-year. Adjusted free cash flow was $4.6 billion, up 4% year-over-year.

T-Mobile was criticized because the analyst believes that the most successful big companies will be those that lock up customers with a bundle of broadband and wireless. That seems to mean that the companies with the most gigabit passings will be the ultimate winners in the market. T-Mobile is expected to have about 15 million fiber passings by 2030. That pales behind the 50 million passings expected by Verizon by 2020 or the 60 million planned by AT&T by 2023. Charter passes 57 million homes today and will be adding 7 million homes when it closes on the merger with Cox. Comcast says it will have 62.5 million passings by 2023. T-Mobile will clearly have the smallest fiber footprint.

How are the other big four converged companies doing with bundling? Comcast had 8.5 million cellular customers at the end of 2Q 2025 compared to 31.4 million broadband households. Charter had 10.9 million cellular customers compared to 29.9 million broadband households. AT&T reported for 2Q 2025 that 40% of its fiber customers are buying cellular. I can’t find where Verizon highlights the percentage of homes that buy cellular and broadband.

So this year, the stock market doesn’t seem to be valuing the converged carriers evenly. As I wrote this blog, T-Mobile stock was up 19% for the year. Comcast stock is down 11% for the year and Charter is down 22%. Verizon stock is up 6% and AT&T is up 20%. There is a story behind all of the stock price changes, and it mostly involves changes in customers and earnings, not in the percentage of convergence.

One thing is clear. These five companies dominate the telecommunications space. The five companies have most of the cellular customers in the country, and T-Mobile will be adding customers from the USCellular purchase. The five companies had over 98 million broadband customers at the end of the second quarter of 2025, and Charter will be adding 6-7 million more customers if the merger with Cox is approved. The five companies account for almost all of the national net growth of broadband customers.

The KeyBank analyst was looking at the long-term trajectory of T-Mobile compared to the other giant companies. The analysis statement seems to assume that FWA growth will eventually top out and decline in competition with the other big carriers. But for now, in the second quarter, T-Mobile had the biggest growth in both cellular and broadband customers. It’s obvious that T-Mobile has something today that customers value. My crystal ball is not clear enough to be able to predict that T-Mobile is going to stop growing any time soon, and it seems too early to predict that T-Mobile won’t be in the same category as the other four converged companies.

A Peek at the New BEAD

The State of Tennessee released a side-by-side comparison of the new Benefit of the Bargain round of BEAD applications compared to its initial round of BEAD applications conducted before the revised BEAD rules.

The side-by-side comparison (file:///C:/A/Articles/Tennessee-BEAD-Comparison.pdf) is interesting and shows some big differences between the two grant rounds:

  • Tennessee received 541 applications in the new Benefit of the Bargain round compared to 298 applications in the original round of BEAD.
  • The low-orbit satellite companies Starlink and Kuiper bid throughout the state. Starlink didn’t submit any applications in the first round but bid almost everywhere in the new BEAD round. Kuiper bid for most of the state in both BEAD rounds. Satellite is clearly going to win a significant amount of grant funding since there were 68 of 173 serving areas that got proposals from one or both satellite providers and no other technology. The satellite companies surprisingly don’t seem to be fazed by bidding in Appalachia.
  • There were surprisingly few proposals for fixed wireless technology, with proposals only made in 12 of the 173 study areas included in the new round of BEAD. Part of the reason for this might be the mountainous and hilly nature of much of Tennessee, but there are plenty of areas in the central and western parts of the state where wireless will work well.
  • Comcast switched technology from the first to the second round. In the first round, the company proposed to build fiber, and in the new round it mostly changed to traditional hybrid fiber/coaxial networks – apparently to be able to bid at a lower cost. This makes me wonder if it’s really cheaper to build copper coaxial cables than fiber or if Comcast is just willing to take less funding.
  • There has always been a big question of whether big ISPs would show up for BEAD. There are three big companies in the new round of BEAD – AT&T, Comcast, and Windstream. The industry has always wondered if AT&T would join BEAD.
  • There are a number of smaller ISPs asking for funding to build fiber that includes cooperatives and municipalities.
  • There are four service areas that had no proposals. The state will have to talk an ISP into serving these areas before they can close out their BEAD grants.

It’s impossible to make any definitive cost comparisons between applicants because the new BEAD rules allow ISPs to request to serve areas smaller than the serving areas suggested by the state. There are also roughly 7,000 fewer passings on the newest BEAD map than were included in the initial BEAD grants. But in general, the comparison shows:

  • Most companies proposing to build fiber bid less the second time, but some of this could be due to fewer eligible passings and not just to a sharpening of the pencil.
  • Fiber ISPs across the country are wondering how much lower other technologies will bid in BEAD. There is only a single company asking to build wireless in the state, and their proposed grant awards are roughly one-third the cost of those asking for fiber in the same study areas. But without knowing more details, that ratio might not mean anything for other states.
  • However, satellite bids are incredibly low, most at 10% or less than proposals to build fiber. There is a map showing the eligible passings by study area, and I eyeball the satellite bids to be in the range of $400- $600 per passing. Kuiper is generally significantly lower than Starlink. These low bids are going to worry ISPs everywhere.

 

Increasing Broadband Price Competition

Competition has been creeping into broadband pricing for the last several years as cable companies have been using low introductory rates to try to win new customers and offering similarly low price to try to keep them. Anybody who competes against the big cable companies will tell you that cable companies have been competing for years by offering two-year promotional prices to keep customers.

However, competition might have gone into a new gear recently when Comcast began offering low rates with a five-year price guarantee. The 5-year guaranteed rates were introduced soon after Verizon offered a 3-year price guarantee for FWA wireless home broadband.

In a Comcast blog dated April 15, Comcast announced a 5-year guaranteed rate plan for new customers for 400 Mbps broadband for $55 per month. The product comes with the company’s WiFi Gateway and no contract is required. The plan also includes a free Comcast cell phone plan with a 30 GB data cap for one year. This is a substantial discount. The list price for 400 Mbps is $86, and the normal charge for the WiFi Gateway is $15. The cell phone normally costs $30 per month. The 5-year rate is available through June 23, but Comcast has already told some news outlets that the special rate offer will probably be extended.

On the announcement date, several news outlets like PC Magazine listed the 5-year deal packages as 400 Mbps ($55), 600 Mbps ($70), 1.1 Gbps ($85), and 2.1 Gbps ($105). The outlets also reported that these rates only come with an auto debit to a bank account. Comcast will charge $8 more to bill to a credit card and $10 more for a paper bill.

The low prices were likely also prompted by the recent announcement that Comcast lost 199,000 broadband customers in the first quarter. In this same quarter, the FWA products from AT&T, T-Mobile, and Verizon gained 913,000 customers.

Comcast’s competition isn’t sitting still. Verizon recently announced a 3-year lock for FWA broadband prices at $35 per month for customers who accept autopay and who also buy a Verizon cell plan. Verizon includes up to a $250 Amazon gift card. Not to be outdone, T-Mobile now offers a $35 price for FWA broadband with a 5-year guarantee for customers who have a T-Mobile cellular plan. The Verizon and T-Mobile plans seem to be more focused on reducing cellular churn than gaining new broadband customers.

Comcast is clearly trying to stop the loss of customers. I have to wonder about the overall impact of such widely advertised special rates. How will these low play with the millions of customers who are paying a lot more, including the many paying $15 per month for a WiFi gateway?

Will this lead to Comcast finally lowering its list prices? The company has raised rates annually for over a decade. Can the company maintain high rates in noncompetitive markets while widely advertising severely discounted prices elsewhere?

I’ve been saying for years that broadband will cost $100 per month. When considering the WiFi gateway, Comcast’s list prices were already there. Comcast isn’t even the most expensive cable company, and a handful of cable companies like Cox, Breezeline, and Mediacom have even higher list prices.

This announcement by Comcast, and the constant advertisements from the FWA providers, could prove to be a watershed moment for prices in the industry. Just imagine the glee that USTelecom will have next year if they can announce that prices for broadband are actually decreasing.

Broadband Trajectories

For most the dozen years I’ve been writing this blog, the biggest cable companies accounted for almost all of the growth in broadband customers. Quarter after quarter, and year after year, the big cable companies were the source of almost all new net broadband customers.

This started to shift a few years ago when FWA cellular home broadband from T-Mobile, Verizon, and more recently, AT&T entered the scene. For the last couple of years, almost all of the net broadband growth in the country came from the FWA technology and these three carriers.

It’s clear that we’re now entering a new stage the industry where cable broadband losses are accelerating, where FWA growth hasn’t slowed, and where the big telcos are growing again because of their expansion of fiber.

Consider the following statistics that show the net change in broadband customers over the last year, and for the latest quarter, for the largest cable companies, largest telcos, and FWA carriers. There are a few big companies missing from this comparison like Cox, Mediacom, and Windstream, since those companies are privately held and don’t publicly report customer counts.

These numbers show that telcos other than Lumen are growing again. The numbers for telcos don’t tell the whole story because net customer changes in the table include both DSL losses and fiber gains. For example, during the last year, AT&T added over 1 million customers to fiber.

These trajectories don’t bode well for the big cable companies. There were a lot of predictions made last year that FWA growth would slow down, and that doesn’t seem to be the case yet in 2025. The telcos are all picking up steam in terms of adding fiber customers. It’s going to be interesting over the coming years to see how the biggest cable companies fare in battling everybody else. Charter has decided to fight the trend through the merger with Cox. We’ll have to wait and see what the rest have in mind.

Comcast’s Woes

On the recent Comcast quarterly earnings call, the company’s President, Mike Cavanagh, admitted the company is having problems and said that Comcast isn’t ‘winning in the marketplace”. There are probably not a lot of people who will read this blog and shed a tear for Comcast. For much of the last decade, Comcast, along with Charter, thrived by taking customers away from telephone companies.

Comcast lost 199,000 net broadband customers in the first quarter. The losses may not seem significant for a company with 31.6 million customers, but if this quarterly loss is sustained the company will drop 2.5% of broadband customers for the year.

It’s obvious that both fiber overbuilders and FWA wireless are taking customers from Comcast. AT&T, T-Mobile, and Verizon added 913,000 new FWA customers in the first quarter of 2025 and haven’t slowed down on customer acquisition as some have predicted. It’s a little harder to quantify the additions to fiber in the quarter since dozens of companies are building fiber to compete with the big cable companies in various markets. But everything I hear says that in every new market where fiber appears, the fiber ISP is snagging a quick 30% to 40% market share.

Cavanaugh says there is a disconnect between the strength of the Comcast networks and the inability to win or keep customers. The company has concluded that the two primary causes for their problems are price transparency and predictability.

It’s clear that Comcast has been counting on having better broadband speeds as a lure to attract and retain customers. The company has been working to increase upload speeds in the current DOCSIS 3.1 networks, and the company announced in September 2024 that it was ready to go full bore on upgrading to DOCSIS 4.0, which will bring multi-gigabit upload and download speeds.

But that doesn’t seem to be impressing customers in the way the company hoped. I’m not sure what Comcast means by price transparency, but it’s clear to customers that Comcast has been the most expensive of the large ISPs. The company’s published list prices for 300 Mbps or faster broadband all pushed or exceeded $100 per month after counting the $15 monthly fee for a WiFi modem. Comcast list prices are far higher than FWA, priced at $55-$65 and also significantly above what most fiber ISPs charge.

It’s not hard to understand price predictability. Customers paying full prices for Comcast broadband have surely been dismayed to see the company continually lowering promotional prices as the company has tried to be more competitive. It seems like Comcast prices have been different every time I checked them in the last year.

It looks like Comcast is going to bite the price bullet. On the earnings call the company announced new pricing of 400 Mbps for $55 per month that includes the WiFi modem and is guaranteed for five years. The new price won’t require a customer contract. Comcast is also throwing in one line of cellular for free for a year.

This is going to be a drastic change for the company. In the third quarter of 2024, the company’s ARPU was $73.78 per customer per month, and these new prices will knock that lower. It’s going to be a grand experiment to see if guaranteed low prices can turn the corner for the company. I have to imagine millions of existing customers are going to ask for that price, and it’s going to be hard to say no to them.

Lower prices will not change the fact that urban broadband is growing increasingly competitive. Comcast thrived for years by charging high prices in noncompetitive markets to offset lower prices in competitive ones. But noncompetitive markets are becoming a thing of the past.

Comcast did have one piece of good news in the first quarter. The company added 345,000 new cellular customers. That puts them on par with the other big carriers. T-Mobile added 495,000; AT&T added 324,000; Charter added 514,000; and Verizon added 94,000.

AI Hype Begins

It didn’t take long after the widespread introduction of AI into the business environment for a carrier to claim it is using AI better than the competition. Masha Abarinova wrote an article in Fierce Networks that quotes Comcast as saying it is using AI more effectively than its fiber competitors.

The article covers a discussion with Elad Nafshi, the chief network officer for Comcast, who brags on the ways Comcast is already using AI more effectively than fiber-based ISPs. She quotes Nashi as claiming that Comcast has embedded AI that is “literally feet away from a customer” with real-time pattern detection capabilities that give Comcast the ability to pinpoint interference in the network.

I can already anticipate the fiber ISP retort to this claim, with fiber ISPs saying they don’t need a last-foot AI capability because fiber doesn’t have any interference since it has the same quality of service from end-to-end in the network.

I’ve been waiting for this first shot across the bow and suspect that Comcast’s claim will set off a chain of industry players claiming their flavor of AI is better than the competition. These claims are mostly hype and are aimed at Wall Street analysts and not at the general public. The biggest companies in the industry never miss a chance to claim they have an advantage. It’s easy at this early stage of AI to make this kind of claim since nobody can tell how much of such a claim is hype versus reality. Throw around enough buzzwords, and nobody can challenge such a claim.

A more interesting observation in the article quotes Nafshi as saying that general AI use among customers has not resulted in increased network traffic. He noted that while customers are using ChatGPT and OpenAI, the interactions between customers and the clouds are mostly passing text, which is not data intensive.

This differs a lot from what other industry players have been claiming about the future of AI. The article cites AT&T’s prediction that its network traffic will double by 2028 due to AI. Zayo cited an expected huge growth in network traffic as the justification to buy the fiber networks from Crown Castle.

I’ve been scratching my head for several months trying to figure out how AI might create the predicted explosive growth. I’ve yet to see anybody describe the specific AI traffic or functions that could double the traffic for a company like AT&T.

Network traffic is growing for other reasons. Ericsson recently predicted a 16% annual growth in cellular traffic. Numerous predictions for home and business broadband have predicted growth rates of 10-12% annually. Something drastic and new would be needed to double overall traffic on AT&T by 2028.

New Technology to Lower Latency

There is a new network tool that’s starting to be eased into networks that can significantly lower latency. The new standard L4S (Low Latency, Low Loss, Scalable Throughput) was released in January 2023.

You might ask why we need better latency. Most of you have taken speed tests that measure latency with a ping test. That’s a measure of the time it takes for a single connection between your ISP and your router. The FCC says any latency below 100 ms (milliseconds) is acceptable, and unless you’re using high-orbit satellite broadband, you’ll likely never see a ping latency over 100 ms.

However, a ping test doesn’t tell you anything about the latency while using broadband. A lot of the problems users have with broadband come from latency issues when the network is under load. This latency is often referred to as buffer bloat. Measuring latency under load means looking at the accumulated latency from all network components of an Internet connection. Every component in the network – the switches and routers at both ends of a connection plus your modem each has a limit on the volume of data that can be carried at any given second. If everything is working right, then latency under load is low since packets are being delivered to your computer as intended.

Connections are rarely perfect, and that’s when troubles begin. Let’s say that your home router gets temporarily busy because the folks in your home are doing multiple tasks at the same time. If your home connection gets busy, the packets can pile up, and many get dropped. This prompts the originating ISP to resend packets. Your home router has a buffer that is supposed to compensate for this by temporarily holding packets, but that often doesn’t work as planned, particularly for real-time transmissions like a Teams video conference. Every time packets have to be resent adds more time to the latency for a particular connection, and the more packets that are coming in due to resent packets, the greater the chance of even more backlog.

You may not have noticed, but the Ookla speed test also tells you about your latency under load. Immediately to the right of the ping latency is the average download and upload latency during the speed test. These two readings are a better indicator of your network performance.

If you really want to understand your latency, watch those numbers during the speed test. In writing this blog, I took speed tests on my computer and cellphone. My ping on Charter was 34 ms – a little slower than what I normally see. The average download latency was 147 ms, and during the test, I saw one reading over 400 ms. The average upload latency was 202 ms, with the highest reading I saw at 695 ms (seven tenths of a second). My AT&T cellphone latencies were higher (which is normal). The ping time was 46 ms. The average download latency was 585 ms, with the highest reading I saw at over 1 second. The average upload latency was 102 ms, with the highest reading over 300 ms. The high readings of latency under load explain why I often struggle with real-time activities.

How does L4S fix this problem? First, the various components of your network have to enable L4S. The most important components are the originating switch, the switches at your ISP, and your home router. When these network components have enabled the L4S technology, the goal is to reduce the time that packets are waiting in queue. L4S adds an indicator to packets to report the experience they had moving through the Internet. L4S doesn’t react if everything is working fine. But if there are delays, the originator of the transmission is asked to slow down the rate of sending packets (as are other enabled components in the network. This temporary slowdown stops packets from building up and can drastically reduce the percentage of dropped packets.

Comcast has started to work L4S into their networks in some of its major markets. They report that the technology can cut load latency at least in half, in some cases bringing the latency under load to close to the ping latency.

The real key to making this work is to have the largest content providers build L4S into their networks. For example, a gaming app would need to make sure L4S is enabled at their serving data center to take advantage of the improved latency. If the Comcast trials are successful, it seems likely that a lot of the industry will adopt L4S, and savvy users will avoid applications that don’t use it.

There will be an interesting shift in the industry if use of L4S become widespread. A lot of customers have upgraded broadband speeds to get better performance but found that they didn’t see a big improvement. It a lot of cases, the real culprit in bad performance is buffer bloat. If this gets introduced everywhere, customers might find they are satisfied with slower broadband speeds.

If you to dig deeper into the new standard, you can find it here.

 

Comcast and Charter Stocks Drop

The stock market punished Charter and Charter last week after the two companies reported small customer losses in the fourth quarter of 2024.

First the facts. Charter reported a loss of 177,000 broadband customers. With a customer base of almost 30.1 million customers at the end of 3Q 2024, that’s a 0.59% loss of customers – just over one-half of one percent. The stock market reacted by dropping Charter stock from $361.22 to $326.78 – a drop of 10%.

Comcast reported a loss of 139,000 broadband customers. With a customer base of over 31.8 million customers at the end of 3Q 2024, that’s a 0.44% loss of customers – less than one-half of one percent. The stock market reacted by dropping Comcast stock from $37.54 to $32.58 – a drop of 13%.

On the surface, this seems like an extreme overreaction to small losses. Textbook stock valuations would not concentrate on something like the customer counts but on overall earnings. Consider Charter, which released its fourth-quarter earnings. While the company lost 177,000 broadband customers, Charter also:

  • Added 529,000 cellular customers in 4Q 2024.
  • Fourth-quarter revenues are up 1.6% over the previous year.
  • Fourth-quarter EBITDA was up 3.4% from the previous year.
  • Charter bought back $1.3 billion of its shares, which is supposed to increase stock value.
  • On the bad news side, Charter lost 1.23 million cable TV customers during 2024, a trend that has been happening for years. That’s a little higher than the 1 million cable customers lost in 2023.

Comcast results are similar for the fourth quarter. In addition to losing 139,000 broadband customers,

  • Comcast added 307,000 cellular customers in 4Q 2024.
  • Fourth-quarter revenues are up 0.2% over the previous year.
  • Fourth-quarter EBITDA was up 3.5% from the previous year.
  • On the bad news side, Comcast lost 1.58 million cable TV customers during 2024. That’s an improvement over the 2 million cable customers lost in 2023.

Perhaps the drops are recognition of the long-term trajectories for cable companies. Both companies told investors in 2024 that they had weathered the storm to offset losses due to FWA wireless. However, AT&T, T-Mobile, and Verizon had another great quarter and added 960,000 FWA customers.

Cable companies are also seeing increased competition from fiber overbuilding. RWA LLC recently issued a report that fiber overbuilders passed 10.3 million total homes for the year ended September 30, 2024. Over 9% of that new fiber is being built by cable companies. RVA says that in neighborhoods where fiber has been in place for several years, cable companies lose an average of 33% of their customers.

It’s actually amazing that the cable companies have maintained customers over last year while fending off FWA and fiber overbuilding. The fact that customer losses are small is a success story. However, there is a darker side to the story – they’ve kept customers by cutting prices. While Charter and Comcast both had broadband rate increases in 2024, both have been keeping customers by lowering rates.

It’s likely that the size of the stock price drops were exaggerated due to the craziness that happens in markets in times of economic uncertainty. These are not the only companies getting punished in the stock market. But maybe this is an overdue adjustment due to changes in the underlying fundamentals of the businesses.

What if Nobody Shows up for BEAD?

Charter CFO Jessica Fisher recently announced that Charter will spend substantially less on pursuing BEAD grants than the company spent on RDOF. This is big news, because a natural assumption in some state broadband offices is that Charter would likely be a big player in the BEAD grant process. Charter has been a major participant in pursuing and winning State broadband grants funded by ARPA and the Capital Projects Fund.

To put this into context, Charter won about $1 billion in the RDOF reverse auction. Substantially less than that would make Charter a minor participant in the BEAD process. Fisher said part of the reason for not strongly pursuing BEAD is the unfavorable BEAD grant rules.

This will be a problem for some states if Charter doesn’t play at all. Anybody who has looked closely at the RDOF award areas understands the issue that RDOF funding was often awarded in a way that the coverage could best be described as Swiss cheese. In states where Charter won a lot of RDOF subsidy, the company is the only sensible ISP to pursue a solution for the ‘holes’ inside the current Swiss cheese areas – because if they don’t, it will be virtually impossible for any other landline ISP to affordably reach the small pockets of BEAD areas surrounded by Charter fiber areas.

Nobody outside the company knows the real motivation and decision-making process inside a company like Charter. Certainly, the complexity of applying for the BEAD grants and then reporting afterward is a believable reason for walking away from BEAD. In comparison, RDOF has very few rules other than requiring a specific technology, meeting construction goals over a long timeline, and providing a letter of credit to support each project. Charter is probably considering other issues too. For example, the company has been losing customers to FWA and due to the end of ACP. A decision not to pursue BEAD might simply be a reaction to tightening its focus on current markets.

The real concern for State Broadband Offices is that Charter might not be the only large ISP thinking of ignoring BEAD. Most states are counting on large ISPs like Charter, Comcast, Frontier, Windstream, and Brightspeed to pursue BEAD.

After anticipating the matching fund requirement, the total awards for BEAD projects will be more than $50 billion. If the big companies don’t participate, there may not be enough financial capacity in the rest of the industry to take on the matching requirements for winning BEAD grants.

Consider Comcast, which said in 2023 that it remains return-driven and will have a high bar for participating in BEAD. Comcast didn’t participate in RDOF, but it did pursue and win a substantial amount of state broadband grants.

I doubt that anybody knows what the Verizon and Frontier merger will mean in terms of BEAD. Verizon said when the merger was announced that it wants Frontier to continue with any BEAD plans. But Verizon has historically been the most disciplined fiber builders in terms of staying within a defined construction budget. It wouldn’t be shocking to see Frontier pull back from BEAD to some extent.

A lot of industry folks have predicted that a handful of big companies would win the majority of the BEAD funding. Perhaps many of them will sit it out, making it even more likely that large portions of BEAD might go to Starlink or wireless ISPs.

Seeing the Impact of ACP

The Affordable Connectivity Program lapsed in May of this year. At the time the program ended there were more than 13 million ACP recipients getting a discount on a cellphone plan and 10 million getting a discount on landline broadband. Charter had fully embraced ACP and was reported to have over half of the landline ACP participants.

There were dire predictions at the end of the ACP that many millions of households would drop landline broadband since they could no longer afford it. For example, a survey conducted by the Benton Institute in June reported that 13% of ACP recipients would be forced to drop home broadband. The Benton survey showed that as many as 43% of low-income homes are subscription vulnerable, meaning they struggle to pay a broadband bill.

Any immediate impact of the end of ACP was softened as many ISPs extended ACP benefits for a few months out of their own pockets in the hope that Congress would pass legislation to continue the plan. That likely pushed any noticeable impact from ACP out until late summer.

Many ISPs also offered an alternative low-income plan for qualified customers. It’s possible these low-income plans have enabled households to stay connected.

  • Charter kept its Spectrum Internet Assist plan that offers 50 Mbps for $24.99, with the speed for an extra $5.
  • AT&T continued its Access from AT&T that provides 100 Mbps on fiber for $30.
  • Comcast kept its Internet Essentials plan that provides 50 Mbps for $9.95.
  • Cox kept its Connect2Compete plan for households with students that provides 100 Mbps for $9.95 and $30 for other households.
  • Mediacom offers its Xtreme Connect plan for $28.99 per month, which is reduced to $14.99 for homes with students.

We got a glimpse into the impact of the end of ACP recently when Comcast announced third quarter financial results. Comcast reported that it lost 96,000 net customers in the quarter as a result of ACP, and without the ACP losses the company would have experienced a tiny gain of 9,000 customers. As a side note, this adds to the mystery of where FWA carriers are finding customers, since FWA carriers gained 913,000 customers in the third quarter.

Charter is more of a puzzle. The company announced recently that it lost 113,000 customers in the third quarter. Charter estimated that it lost 200,000 ACP customers, and without that loss it would have had a net positive gain of 87,000 customers for the quarter. If there any validity to the results of the Benson survey, Charter might be expected to eventually lose as many as 650,000 customers due to the end of ACP. Perhaps that will come to pass, and perhaps this is just the first set of losses, with other customers trying to hang on to broadband. The Charter gains after accounting for ACP is also a mystery when you consider the big gains for the FWA carriers in the third quarter. Maybe part of that answer to Charter’s growth comes from adding customers as a result of construction in RDOF and areas funded by state broadband grants.

On a national scale, there doesn’t seem to be a big customer drop as predicted by various surveys. If 13% of ACP recipients (1.3 million households) dropped broadband, it would be obvious in the quarter-to-quarter customer counts of big ISPs – and it’s not.

I think it’s more likely that the results of the end of ACP will be more subtle, spread over time, and be harder to notice. While some homes likely dropped immediately, many have likely held on with one of the low-income alternatives offered by ISPs. Homes that find they can’t sustainably afford broadband will drop off over time and likely not make a noticeable ripple in the national numbers.

The real victims of the end of ACP are customers of ISPs that have been building broadband networks in low-income neighborhoods or tribal areas and that relied on ACP payments to make a business case. I expect to hear stories over the next year of some of these ISPs having to shut the door.