Tag Archives: Comcast

T-Mobile and Price for Life

T-Mobile is got a lot of bad press after sending out rate increases to people who believed they had guaranteed rates for life. For a number of years, the company promoted cellular plans that were marketed as a guaranteed price for as long as the customer kept the plans. The level to which people had a guarantee is a little fuzzy since T-Mobile has famously marketed itself as the un-carrier that didn’t require contracts. But T-Mobile marketing material from previous years backs up claims that prices on some packages were intended to be for life.

In today’s world of social media, the rate increases instantly lit up the Internet. On social media, T-Mobile was widely accused of corporate greed. This is understandable since T-Mobile is highly profitable and has enjoyed a long string of steady growth, going from 74 million total customers at the beginning of 2018 to almost 120 million by the end of 2023. In 2023, T-Mobile added 5.7 million postpaid cellular customers, 282,000 prepaid cellular customers, and over 2.1 million FWA broadband customers – an overall customer growth of 7.8%. The claim of corporate greed rings true. The company goosed profits in 2023 by inexplicably laying off 5,000 people, 7% of its workforce, while at the same time spending over $11 billion over the last year to buy back its own stock – the highest amount in the industry.

T-Mobile reacted to the public furor by saying it didn’t intend to raise rates on customers that had rates for life, although it apparently had raised rates for many of them. There is already talk of a class-action suit against the company.

It seems that carriers ultimately get into trouble when they promise rates for life. CenturyLink has been embroiled in several controversies for the practice. As an example, the company had a promotion labeled as Price for Life that promised customers would never see a rate increase on broadband products as long as they stayed in good standing and followed the terms and conditions. But in 2023, CenturyLink raised the rates on customers enrolled in this plan, which led to a class action lawsuit.

In 2016, Comcast door-to-door salespeople offered residents some price-for-life packages in Salt Lake City during a promotion that was done in anticipation of Google Fiber coming to the market. Customers were offered an attractive triple play bundle at $120 per month that included broadband, cable TV, and a telephone line. The Comcast doorknockers promised customers a lifetime price backed up in writing that their price would be good as long as the customer kept the plan. Customers were assured at each step of the process by Comcast customer service reps that they were buying a lifeline plan and that rates would never be increased.

However, in 2018, Comcast corporate folks raised the rates. A class action lawsuit alleged that as many as 20% of the 200,000 upgrades sold during the 2016 sales campaign were sold as lifetime plans. To nobody’s surprise, Comcast customer service denied any knowledge of selling a plan for life that it had supported just two years earlier. Comcast didn’t back down from the rate increases, some of which were substantial.

In today’s world, such behavior inevitably leads to a class action lawsuit from lawyers who see easy pickings from companies that break promises made to customers. I’ve always assumed that big carriers find such lawsuits to be a nuisance, and that the settlements are far smaller than the benefit of breaking the guarantee with customers.

These example should hopefully act as a warning to smaller ISPs. It’s very easy for a marketing department to try to meet sales quotas by making promises to customers that the company might come to regret in later years. There is no question that a price for life is a sales gimmick, and there are no gimmicks that marketing departments won’t try if allowed.

But there is an argument to be made for a price for life if an ISP is disciplined enough to never raise the rates on such customers. There is a huge amount of value in a customer who sticks with a company for many years. This customer will have paid for the cost of the connection many times over and generates a huge amount of bottom-line year after year. But offering prices for life today obligates management for the next several decades to keep track of such customers and never raise their rates.

Competing Against FWA

At the end of the first quarter of this year, T-Mobile and Verizon together have accumulated 8.6 million customers nationwide on FWA cellular home broadband. This is amazing success for a product that was just launched in 2021. The combined FWA customers represent 7% of the entire U.S. broadband market, and if FWA was a single ISP it would be the fourth largest ISP in the country behind Comcast, Charter, and AT&T.

Nobody knows exactly where the companies are finding the new customers because they aren’t telling, and the companies losing customers are mum about it. The FWA technology isn’t everywhere, and T-Mobile claims to cover over 50 million households with the technology, and Verizon 40 million. The appeal of FWA is obvious. The companies offer broadband between 100 Mbps and 300 Mbps in in most markets with prices from $50 to $70 depending on bundling with a cellphone and agreeing to use autopay. The two carriers have also selectively been paying customers to break contracts with other ISPs.

It’s obvious in looking at the claimed coverage of FWA in the FCC broadband maps that a lot of FWA coverage is in rural areas where there aren’t a lot of broadband alternatives. The two carriers are likely snagging customers from DSL, fixed wireless ISPs, and satellite companies, as well as migrating their own rural hotspot customers to the much-improved broadband. However, FWA also covers a lot of towns, suburbs and cities. In these markets, the FWA carriers are touting low prices and faster speeds to lure customers who stayed with telephone company DSL to save money. With low prices, FWA is also clearly targeting cable companies.

It’s been interesting to watch how competitors have been dealing with FWA. In an article in FierceNetwork, Comcast CEO Brian Roberts characterized FWA by saying “Three companies are all simultaneously within a short period of time are all offering a home connectivity product by their own admission a lower speed, more easily congested network.” Comcast is reacting to FWA by advertising the differences between the products. The company has also launched its NOW line of products. This starts with broadband priced at 100 Mbps for $30 or 200 Mbps for $45.

Charter’s CFO Jessica Fischer characterized FWA technology as “lower quality but also lower cost.” She went on to say that FWA will not be able to keep up with increased household demand in future years. Fischer characterized the impact of FWA as “temporary.”

Cox Communication has been advertising against FWA since the end of 2022. In it’s first ads the company said that “FWA is just phone Internet, not home Internet” and isn’t as fast or reliable as Cox’s cable Internet service. The ads went on to warn the public not to “put a cell tower in charge of your home Internet connection.”

Frontier’s Executive Chairman of the Board was quoted at a J.P. Morgan conference as saying that FWA is having almost no impact on Frontier’s fiber business, which is believable since Frontier offers symmetrical 500 Mbps broadband for a standard rate of $64.99, with an introductory rate of $44.99. But Frontier hasn’t been saying anything about the impact of FWA on its DSL service, which is an obvious target for FWA where Frontier has not yet converted to fiber.

It’s an interesting set of reactions. Only Comcast is trying to openly compete with price. It’s likely that the others are quietly offering price deals to keep customers. However, lowering prices has a downside by lowering average revenue per customer – a key financial metric for the industry. ISPs have to decide which is worse – losing customers or lowering prices.

The primary thing that FWA has done to the industry is to shake up the price point for broadband. The big cable companies have all increased list prices annually over the last decade to goose prices to $90 and more. Charter just announced another $3 rate increase across the board. However, a shrinking number of cable customers are paying the list price for broadband.

The cable companies all warn about the ability of FWA technology to serve a lot of customers. The cable companies seem to believe (or at least want the public to believe) that many people will try FWA and not like the broadband experience. The cellular carriers have enough capacity to have gained 7% of the U.S. market in an incredibly short time, and only time will tell if the cell carriers can hang on to these customers over the long haul.

Comcast Trials Hollowcore Fiber

Comcast released a press release that announced it is the first ISP in the U.S. that is trialing hollowcore fiber. Hollowcore fiber takes advantage of the phenomenon where light can travel 50% faster through air than it can through fiberglass. As is described by the name, hollowcore fiber is a fiberglass strand with a small hollow tube in the center.

Comcast is interested in the technology because the faster light speed translates into as much as a 33% reduction in latency. Comcast would use the hollowcore fiber for applications that demand low latency.

The press release described a test where Comcast made a 40-kilometer connection between two locations in Philadelpia to be able to test the performance of the fiber in a real-world application. Comcast was able to successfully establish a bidirectional transmission using simultaneous traffic paths ranging from 10 to 400 gigabits per second to 400 Gbps on a single strand of hollowcore fiber.

Hollowcore fiber has been developed by Lumenisity. The concept of hollowcore fiber was born a decade ago in a DARPA lab working with Honeywell to improve fiber performance. Those tests showed that it was possible to create a single straight path of light in tubes that was perfect for military applications. The light could carry more bandwidth for greater distances without having to be regenerated. By not bouncing through glass, the signal maintained intensity for longer distances. DARPA found the fixed orientation of light inside the tubes to be of great value for communication with military-grade gyroscopes.

Until some recent breakthroughs, the hollow tube fiber was plagued by periodic high signal loss when the light signal lost it’s straight-path coherence. Lumenisity has been able to lower signal loss to 1 dB per kilometer, which is still higher than the 0.2 dB loss expected for traditional fiber. However, the lab trials indicate that better manufacturing processes should be able to significantly lower signal loss.

Lumenisity big breakthrough came when it developed the ability to combine multiple wavelengths of light while avoiding the phenomenon known as interwave mixing, where different light frequencies interfere with each other. By minimizing signal dispersion, Lumenisity eliminated the need for digital signal processors that are used in other fiber to compensate for chromatic dispersion. This means repeater sites that can be placed further apart and require simpler and cheaper electronics.

Lumenisity doesn’t see hollow core fiber being used as a replacement on most fiber routes. The real benefits come in situations that require low latency along with high bandwidth. For example, the hollow core fiber might be used to feed the trading desks on Wall Street. The fiber might improve performance for the fiber serving large data centers.

Cord Cutting Continues in 2023

Leichtman Research Group recently released the cable customer counts for the largest providers of traditional cable service at the end of 2023. LRG compiles most of these numbers from the statistics provided to stockholders, except for Cox and Mediacom – they now combine an estimate for both companies. Leichtman says this group of companies represents 96% of all traditional U.S. cable customers.

I suspect there are regular blog readers who wonder why I post these statistics every quarter. There are several reasons.

  • I find it fascinating to watch the slow train wreck of the implosion of the cable TV industry. Recall that the big cable companies like Comcast and Charter got so large through selling only cable TV and no other products. Technology let them compete and then beat telcos for broadband customers, but they already had a huge number of customers in 2000 when broadband competition kicked off in earnest.
  • I’m fascinated to see that there are still over 55 million household buying cable TV from the largest companies. A lot of folks have completely written off cable TV as irrelevant, and a thing of the past, but 42% of households are still buying a traditional cable TV package. Roughly 30 million homes have cut the cord since 2018, but there are still 55 million more homes that might someday migrate all of their video to broadband networks.

The traditional cable providers continue to lose customers at a torrid pace, losing 1.7 million customers in the third quarter. Overall, traditional cable providers lost over 18,700 customers every day during the quarter. The overall penetration of traditional cable TV is now down to 42% of all households, down from 73% at the end of 2017.In the fourth quarter, Comcast dropped from being the large cable provider and fell below Charter. Losses were big across the board, and only Charter, Verizon, and Breezeline lost less than 10% of the cable customer base for the year. The traditional cable providers lost over 6.9 million cable customers for the year – with only a fourth of those customers choosing an online cable substitute.

In the fourth quarter, online cable substitutes like YouTube and Hulu Live picked up 1,476,000 customers, almost all by YouTube. For the year, these providers added almost 1.9 million customers.

First Look at Broadband Labels

The FCC’s Broadband Labels were implemented by ISPs with more than 100,000 customers on or before April 10. Not surprisingly, many ISPs waited until the last day. I think the FCC hoped that the labels would create “clear, easy-to-understand, and accurate information about the cost and performance of high-speed internet services.” I looked at a lot of the labels this past week. As you might expect, the actual labels often fall far short of the FCC’s goal. I’m not going to use this single blog to try to rate and rank the various labels but will highlight a few of the things I found.

The first observation is that the labels are generally hard to find – they are not prominently displayed on ISP websites. This is because the FCC rules say that ISPs only have to display the labels at ‘points of sale’. ISPs have interpreted this to mean that a customer must first submit a valid address to the ISP website, and then typically navigate through several more links to find the labels. Even after entering an address, the links to broadband labels are often not clearly identified, and it was a challenge to find the labels for some ISPs. I thought one of the purposes of the labels was to make it easier for the public to comparison-shop between ISPs – but finding the labels usually takes a lot of work, especially for somebody who isn’t familiar with navigating ISP websites.

The one big benefit of the labels for most ISPs is that they make it easier to find broadband prices. Over the last few years, it’s grown increasingly difficult to find the list price for broadband on big ISP websites – the price that customers pay at the end of a special promotion rate. ISPs are now disclosing the full list price on the labels.

One exception to showing list prices is Comcast. The company is showing the promotional rates in bold for many broadband products and only shows the list price in fine print. Comcast is also deceptive about the cost of its broadband modem. All they say is that it’s optional, without mentioning that their price for a modem rental is $15. They also don’t mention that to get some features a Comcast modem is mandatory. I rate the Comcast labels as still being as deceptive as their website was before the labels. But Comcast isn’t the only one not being open and clear about the modem rental. I’m guessing that big ISPs are rationalizing that WiFi and the modem are not a broadband product as a way to keep them off the label. Any ISP not disclosing modem prices and policies is creating a hidden fee.

One of the features of the labels is that an ISP is supposed to provide a plain English description if its technology and network practices. Most ISPs failed at this, and a customer trying to understand two competing ISPs is not going to understand the technology difference using the broadband labels.

Consider Verizon. It has a network management section of the label that mixes in descriptions of its wide range of different technologies rather than describing each separately. There are a few things that a shopper for FWA service ought to be told: 1) that the FWA product is delivered over the same network delivering bandwidth to cellphones, 2) that the key factor that determines the speed for a customer at a given tower is the distance between the customer and the tower, and 3) that broadband can be throttled if the cell site gets busy. They disclose the third item, but overall, they fail at describing how FWA works.

The labels are not going to tell the public much about speeds. A few ISPs, like Verizon FWA and T-Mobile FWA, are honest and report a range of speeds. Cox is relatively honest and says that speeds are ‘up-to’ the cited marketing speed for a given product. But most big ISPs are claiming they deliver speeds in excess of advertised rates. Charter says speeds are at the advertised speed or faster. Comcast, CenturyLink, Mediacom, and Sparklight all cite ‘typical speeds’ which are all faster than the advertised speed – some significantly faster. This is the first time I’ve seen the term ‘typical speed’, and I have no idea what ISPs mean by it.

Windstream took an interesting approach to broadband labels and only created labels for fiber customers and not for older DSL. I don’t know if that meets the FCC requirements, but Windstream is reporting 100 Mbps capability for DSL in some markets on the FCC map, and this feels like something that should have a label.

All of the labels must disclose latency, and many of the latency numbers cited seem significantly low. I think that the ISPs are citing the latency between their headend and the customer, not the latency that a customer can expect in getting to the Internet. If so, this also feels deceptive to me.

Overall, the Broadband Labels do not fulfill the FCC’s goals of making it easier for customers to understand broadband products. It is a relief to see most ISPs disclose prices – but if Comcast gets away with highlighting marketing promotional rates, the labels for other ISPs might change soon to match. Disclosures on speeds are mostly a joke – and most customers are going to be surprised to find that their ISP is bringing them faster speeds than what they are paying for (sarcasm alert). For the most part, the descriptions of network practices are not written in plain English to help a potential customer understand the technology being used. The carefully crafted lawyer language in these sections makes it hard for even experienced industry folks to understand network management policies.

Are There Two Broadband Markets?

In a recent survey of 8,000 broadband customers nationwide, Parks Associates found that FWA cellular wireless customers feel better about the price they pay for broadband than subscribers of other technologies.

The survey asked broadband customers to react to the following statement: “I receive Internet service at a fair cost / good price”. The response by technology was as follows:

  • 61% of FWA cellular customers reacted positively to the question.
  • 51% of fiber customers feel they are paying a fair price.
  • 40% of DSL customers responded positively.
  • Only 35% of cable customers think they are paying a fair price.

These responses are measuring two things – the way customers feel about broadband performance of each technology combined with how they feel about the price.

These survey results have to be troubling to cable companies. Cable companies have been raising rates regularly for years. For example, Comcast already has rates far higher than FWA, and yet the company still raised rates by $3 in December 2023. There is no mystery why customers like FWA pricing more than cable company pricing. Comcast has a list price of $86 for a 200/5 Mbps broadband connection, and most customers also are charged $15 for a modem. This contrasts with Verizon FWA, which has a list price of $60 for speeds between 100 – 300 Mbps, with addition savings for using autopay or for bundling with Verizon cellular. T-Mobile FWA has a list price of $65 with a small discount for autopay.

However, the list price isn’t everything since a lot of customers are paying less than list price. Verizon had a recent promotion for FWA home broadband at $40 for new customers and $25 for existing cellular customers. T-Mobile has been advertising a price for home broadband for $30 for existing T-Mobile cellular customers. Comcast also has heavily discounted special prices. There are current web deals for buying the 200/5 Mbps plan for $30 ($45 with the modem). But every customer buying a low-price Comcast product knows the prices will eventually skyrocket when the promotion is over.

The customer reactions to fiber are more puzzling where 50% of customers don’t think they are paying a fair price. Many fiber providers have prices that aren’t that different than FWA wireless. AT&T sells 300 Mbps fiber for $65. CenturyLink sells 500 Mbps fiber for $50. Frontier sells 500 Mbps for $50.

My consulting firm conducts surveys, and we’ve been seeing similar results. I’ve recently come to the conclusion that there are two different broadband markets in the country – a market of customers who care about price and one where customers care about speed.

There has been a huge migration of customers upgrading to gigabit broadband. OpenVault reported that at the end of 2023 that one-third of all broadband customers are now subscribed to gigabit speeds. These are clearly the customers who care about speed, and these households are likely not interested in the slower speeds being delivered by FWA cellular wireless.

Eight million customers have elected to buy FWA home broadband that delivers top speeds between 100 and 300 Mbps. Some of these customers live in rural areas where this is the only fast option, but many of these customers are in towns and cities and are switching from cable companies and fiber ISPs. These are the customers for whom price is more important that broadband speeds. These customers find the FWA speeds to be good enough, at least in relation to the price they pay.

This creates a real dilemma for cable companies. They have lowered the promotional prices to the lowest level I’ve seen in many years to compete with FWA prices. At the same time, cable companies are seeing many customers migrate to the fastest speeds and higher-priced products – but these customers hate the prices. It’s easy to understand customer dissatisfaction when some customers are getting promotional prices at $30 while many other customers are pay far more than $100. It’s virtually impossible for a cable company to satisfy both sets of customers. The attempt to deal with the two drastically different market segments might be a major part of the reason why Comcast and Charter have stopped growing.

Telcos Shedding Jobs

I heard a chilling story recently. AT&T apparently notified a bunch of employees in Los Angeles that their jobs are being eliminated and that they need to report to other cities like Dallas or lose their job. Many of these employees were relocated to Los Angeles in the last five or six years, and the company paid for that past relocation. Employees now must move at their own expense. I was told the same thing was happening in other AT&T markets across the country. This is a particularly callous way to eliminate employees, and AT&T is clearly trying to induce employees to resign to avoid paying severance. This is not the kind of behavior that would normally be expected from a large corporation. It certainly tells the remaining employees of the company that they are not valued.

There is rarely a month that doesn’t go by without hearing that one of the big telcos is laying off a group of employees somewhere. The story piqued my interest, and it took only a little research to see that telcos have steadily been eliminating staff while the biggest cable companies have not.

Consider the following chart that shows employment at the biggest ISPs and carriers since 2018.

2018 2023 Change
AT&T 268,220 150,500 -44%
Verizon 144,500 105,400 -27%
Lumen 45,000 28,000 -38%
T-Mobile 80,500 67,000 -17%
Comcast 184,000 186,000    1%
Charter 98,000 101,100    3%

It’s not easy to make sense of the staffing changes at the various carriers. Consider some of the big trends at each company since 2018.

Some of the staff reductions at AT&T can be justified since the company suffered from several disastrous investments. The biggest was buying Time Warner Media and spinning it off just three years later to Discovery with a huge loss. The company had another big failure from its purchase of DirectTV. While AT&T flourished from 2018 to 2023 in adding cellular customers, competition dropped the average revenue per customer over that time period. AT&T lost only 3% of its net broadband customers over that period while it has been transitioning from copper to fiber.

Verizon has a similar story of making bad investments in AOL and Yahoo. Due to the big surge of FWA cellular broadband and good sales in FiOS, Verizon has 54% more broadband customers today than it had in 2018. Verizon also thrived and grew cellular customers during this period.

Everybody has likely heard Lumen’s story. The company has struggled since it was spun off from AT&T as US West. The company divested it’s copper assets in twenty states and recently announced more layoffs.

T-Mobile is an interesting case. Cellular customer additions have been sluggish since it merged with Sprint. It recently added 4.8 million FWA broadband customers. The layoffs at T-Mobile seem to be clearly aimed at improving the bottom line – even though one of the big promises made to employees with the Sprint merger was that it would create new jobs, not lose jobs.

Comcast has thrived in everything except cable TV. Since 2018, the company added 5 million broadband customers and 6.5 million cellular customers.

Charter also did well except with cable TV. Charter added 5.3 million broadband customers since 2018 and 7.8 million cellular customers.

The bottom line of my quick analysis is that telcos have been reducing staff at a much greater pace than can be justified by looking at the overall trends of each business. I have to wonder how Comcast and Charter are going to react to the sudden slump in broadband growth? Will they now start shedding employees like the telcos have done?

Is it Time for Rate Cuts?

Comcast and Charter broadband customer growth has stagnated, and all of the cable companies are now slowly losing customers. There are a lot of reasons for the stagnation and customer losses. There is new competition from fiber overbuilders eating into the core markets of cable companies. The big customer growth in the broadband industry over the last two years has been with FWA wireless from Verizon and T-Mobile, and this also has to be eroding cable broadband customers.

One of the factors that put cable companies at such a competitive disadvantage is broadband prices. The cable companies have been regularly raising rates annually for years to levels that are far higher than all of their competitors. The high rates were sustainable in markets where the cable companies held a virtual monopoly, but an increasing number of their markets now see competition from fiber and FWA.

To be fair to the cable companies, not all customers pay the highest list rates. My firm has been doing broadband surveys throughout the country, and we find a lot of people paying the high rates. Interestingly, the customers who have been with a cable company the longest tend to pay the most, while newer customers have been offered much lower special rates.

I’ve been expecting cable companies to react to the new competition. They have a number of options for how to react to competition, and one option is to lower rates. I recently saw that Altice (Optimum) announced a major decrease in its undiscounted standalone rates. Altice has good reason to lower rates. Since the beginning of 2022, the company has lost 4% of its broadband subscribers, losing 189,000 customers on a base that was at 4.8 million at the beginning of 2022. The company had a net broadband customer loss in every quarter in the last two years.

Altice/Optimum has some of the most expensive list prices for broadband in the industry. Its list rates have ranged from $109.99 for 300 Mbps broadband to $139.99 for gigabit speeds. It has lowered those two prices to $70 and $110. The company says that it doesn’t have a lot of customers paying the list rate, but there are some.

To offset the rate decreases, Altice is raising its Network Enhancement Fee to $6 per month, a fee that applies to all customers. This had a list price of $4.50, but a lot of customers were paying as little as $1.50. This is the type of hidden junk fee that the FCC has been highlighting because it is nothing more than a way to bill customers extra money. It’s possible that what is being dressed up as a rate decrease could end up costing customers more in the short run.

Not every cable company is taking the same tactic. In December 2023, Comcast announced an average rate hike of $3 per Xfinity broadband customer. The company raised rates even though it has been seeing a small overall broadband customer decrease and an even larger erosion of cable TV customers.

Cable companies are under tremendous pressure from Wall Street to increase earnings, and that’s extremely challenging in an industry where they are losing customers to multiple aggressive competitors. Comcast reported to investors at the end of 2023 that its revenue per customer has been climbing. It’s likely that the company has been cutting back on the discounts given to customers and that more customers are paying the list rates. Raising rates or cutting back on giving discounts is the only way to increase revenues when competitors are taking customers. It’s going to be interesting to see what the other big cable companies do this year.

What’s Up With Comcast and Charter?

The two biggest cable companies in the country have clearly bogged down. In the third quarter of 2023, Comcast lost 18,000 broadband customers while Charter gained 63,000. To contrast the extent of the slowdown, Charter gained over 1.3 million customers in 2021 while Charter gained 1.2 million. The growth during the pandemic was not extraordinary, and both companies added 1.4 million customers in 2019 before the pandemic.

The two companies are still the largest ISPs. Comcast had 32.3 million broadband customers at the end of the third quarter of 2023, while Charter had over 30.6 million. Third in size is AT&T at 15.3 million.

Charter is still slowly adding customers due to its strategy of building broadband in rural markets. In the third quarter, half of its growth came from rural areas. Charter won a significant amount of rural subsidy in the RDOF reverse auction in 2020 and has been aggressively pursuing state broadband grants since then. Comcast has also been chasing state grants, and analysts expect that both companies will pursue the upcoming BEAD grants.

There are a number of reasons for the sudden slowdown. At the top of the list is probably prices. The following are the current list prices for the most common broadband products. For both companies, the prices and speeds vary in some markets.

  Download Upload Price
Charter 300 Mbps 10 Mbps $84.99
500 Mbps 20 Mbps $104.99
1 Gbps 35 Mbps $124.99
Comcast 200 Mbps 10 Mbps $90 + $15 for router
400 Mbps 10 Mbps $105 + $15 for router
800 Mbps 20 Mbps $110 + $15 for router
1 Gbps 20 Mbps $115 + $15 for router
1.2 Gbps 35 Mbps $120 + $15 for router

These prices are significantly higher than the prices being charged by fiber competitors:

  Download Upload Price
AT&T 100 Mbps 100 Mbps $60
300 Mbps 300 Mbps $65
1 Gbps 1 Gbps $80
2 Gbps 2 Gbps $110
Frontier 500 Mbps 500 Mbps $59.99
1 Gbps 1 Gbps $79.99
2 Gbps 2 Gbps $109.99
Windstream 500 Mbps 500 Mbps $60
1 Gbps 1 Gbps $85
Verizon 300 Mbps 300 Mbps $49.99
500 Mbps 500 Mbps $69.99
1 Gbps 1 Gbps $89.99

To offset the big price difference with competitors, both companies offer substantial discounts for new customers. Charter tends to continue to renew special pricing while a customer has to work harder to get the discounts at Comcast. Both companies are pushing bundles that include discounted cellular.

As the two charts demonstrate, another big difference is the upload speeds. Both cable companies are upgrading upload speeds to speeds between 100 Mbps and 300 Mbps using mid-split technology upgrades. Both have been talking about upgrading to DOCSIS 4.0 to get symmetrical speeds.

The other new competitor is FWA Cellular Wireless from T-Mobile and Verizon. We don’t know how much traction these companies have in competing against cable companies, but the two companies have added over 7 million customers in the last two years, while Comcast and Charter have stagnated.

  Download Upload Price
T-Mobile 100 Mbps Best Effort $65
100 Mbps Best Effort $60 with Autopay
Verizon 300 Mbps Best Effort $45 with Verizon Cell Plan
300 Mbps Best Effort $60
  300 Mbps Best Effort $50 with Autopay

It’s going to be interesting to see if the two cable companies increase rates in 2024. If they don’t, then the only path to higher earnings would be to cut back on customer or slash expenses.

Both companies have thrived on the combination of customer growth and revenue growth from rate increases. Both companies face a serious earnings challenge in the next few years as competitors chip away at customers.

Cable Company Speed Claims

I don’t know if it’s just me, but my perception of ISP and cellular advertising is that the big ISPs and cellular carriers push the envelope more every year in trying to make claims that can give them a marketing edge over the competition.

The advertising for 5G cellular has repeatedly made claims over the years that are far in excess of the ability of the technology to deliver. If your only view of the state of broadband technology is ads seen on TV during sporting events, you would be fully convinced that we live in a completely wireless world and that 5G is the end-all-and-be-all of the broadband world.

What’s funny about many ads is that carriers try to differentiate themselves from their competitors, even though their peers are delivering essentially the same product to the market. There is not much difference in the cellular technology being delivered by AT&T, T-Mobile, and Verizon – although ads claim that each is by far the superior company. In real life, the biggest differentiator between the three carriers is the strength of their signal at your home, office, and other places you frequent – a strictly local difference based on the location of cell towers.

The competition between cable companies and fiber overbuilders is not based on equivalence. There is a clear technical advantage of a 300 Mbps broadband connection on fiber versus the same connection on a cable company. Fiber has a steadier signal throughout the day with lower latency and jitter, and any consumer comparing the two can quickly spot the difference. This puts cable companies in a tough spot. They know that fiber ISPs have a quality advantage for downloading and a huge advantage for upload speeds. Fiber networks tend to also have fewer glitches and outages.

Cable companies know when a fiber network shows up in a market that they will lose customers who care about signal quality. Since cable company prices are normally higher than the prices of fiber ISPs, the cable companies have to scramble and lower prices drastically with special prices to try to hang on to customers and lure new ones.

But cable company marketers never stop trying to make a pitch that makes them sound better than fiber. One of the latest examples comes from Comcast, which has started to advertise itself as the 10G ISP. The company now refers to its broadband network as the ‘Xfinity 10G Network’. This is based on the CableLabs 10G standard that lays out a future upgrade path for cable companies to eventually achieve an overall speed as fast as 10 Gbps download and 6 Mbps upload.

Verizon took exception to Comcast’s advertising and asked the National Advertising Division (NAD) of BBB National Programs to get Comcast to stop using the term 10G. The NAD program is something that many of the big ISPs voluntarily participate in to avoid expensive lawsuits between each other over advertising claims. NAD ruled that the 10G term was not factual and said Comcast should stop using it. The participants in the NAD generally comply with NAD rulings, but this time, Comcast is appealing the ruling. An interesting sidebar of the NAD ruling is that it also felt that consumers would interpret 10G as some advanced version of cellular 5G.

As an outsider, it’s pretty easy to agree with Verizon in this case. The 10G term was based on some theoretical future upgrade to meet the CableLabs 10G specifications, and Comcast’s coaxial networks today cannot achieve that speed. The only example of where Comcast has a 10 Gbps capability today is where it has upgraded to a 10 Gbps fiber platform – a tiny portion of the overall Comcast network. Comcast’s advertising implies to consumers that the future upgrades are already in place.

In a similar dispute, AT&T took exception to Cox ads that claim that Cox cable broadband is ‘powered by fiber’. NAD agreed with AT&T and ruled that Cox could not imply in advertising that its coaxial network is fiber-to-the-home. Again, it’s easy to agree with NAD on this ruling. Having fiber somewhere in a network does not mean that the network can deliver the same quality of broadband as an all-fiber network. Many DSL fiber nodes are fed with fiber, and I don’t recall any telcos making the claim that their DSL is “powered by fiber”.

More aggressive cable marketing is inevitable in a market where cable companies have stopped growing. There has to be a lot of angst in cable company board rooms about finding ways for the companies to claim fast broadband speeds and stop losing customers.