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In 5 Years, Cable Companies Could Capture 20 Percent Of US Wireless Market

In 5 Years, Cable Companies Could Capture 20 Percent Of US Wireless Market

Watch out, wireless carriers in America. Cable operators could take 20 percent of the wireless market in the United States in half a decade -- well, at least according to industry watchers at New Street Research. In the research note that New Street distributed to investors over the weekend, the research firm stated that mobile service providers are facing slowed customer growth and increase average revenue per user (ARPU) and revenue pressure, and they will soon find themselves dealing with cable companies taking some of their market share in the world of wireless. 

 

The signs are certainly there. The biggest cable TV company in the world in terms of sales right now is Comcast, and in October of last year, the cable giant had decided to execute on its mobile virtual network operator (MVNO) deal with Verizon Wireless. The talk is that Comcast is planning to introduce a service that makes full use of its Wi-Fi footprint before the end of this year. Another cable powerhouse name, Charter Communications, is looking at the possibility of offering a countrywide wireless service, as revealed by Tom Rutledge, its chief executive officer, last month. Rutledge explained that Charter’s acquisition of Time Warner Cable has given it access to the same Verizon Wireless MVNO agreement as its rival Comcast.

 

Via their respective MVNO deals with the Big Red, Comcast and even Charter could start introducing wireless services a few months from now. Of course, as an MVNO, both companies will only have limited reach. Still, there is no stopping Comcast or Charter from partnering with other wireless carriers who can allow them a more expanded coverage. According to analysts from New Street Research, T-Mobile looks to be the wireless carrier in the best position to be courted by cable companies who want to go into wireless.

 

As projected by New Street Research’s data, cable companies could enjoy a 20 percent share of the wireless market in five years, effectively grabbing away some 35 million customers from today’s wireless carriers. The change could come as early as this winter, with Comcast and possibly Charter Communications leading for the way for cable operators to starting offering commercial wireless services. New Street Research notes however that at the onset, it will only be at a limited capacity. But in half a decade, there could be sudden growth, which is totally not unheard of, especially in an industry prone to rapid changes.

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