Combining Mobile with Broadband

Why have all major US Cable operators launched their MVNO service (Cox is the latest to announce theirs with Verizon) and how are they doing? Comcast for example just added a record 365,000 mobile lines in Q4 2022 to bring its total to 5.3 million five years after the service launched.

The rationale for cable MVNOs hasn’t really changed since I launched one of the very first Cable + MVNO plays for Liberty Global’s Telenet back in 2009.

  • Cable broadband is sold to a home, while mobile is sold to an individual. Across North America and Europe, that’s a x 2.4 multiplier effect (2.4 is the size of an average household). So if you have a relationship with a household, why not try to sell mobile to all those customers?

  • From my experience, churn (i.e people leaving their Cable provider) pretty much disappears when you associate at least one mobile plan with a Cable household. There’s no magic behind that, but you basically discount the mobile plans as long as the customer stays with cable or vice-versa. You can also overlap the contract periods.

  • Finally there’s also good incremental revenue in mobile, on average US$50 per month for postpaid plans.

So there you have it: plenty of new addressable opportunity, great for churn prevention, and strong incremental revenues. So should all Broadband providers launch mobile plans?

The challenges for Broadband Providers are typically:

  • Difficulty in negotiating a commercially viable deal with a hosting carrier. A lot of our clients tell us they don’t know what a “good” deal looks like for a profitable MVNO.

  • The Management and Engineering/IT are typically busy with their core Broadband business roadmap, and there are no resources for a new mobile service. The sales, marketing, regulatory teams need to hire and build a mobile team from scratch.

We’ve solved these issues for multiple recent Broadband customers by planning the MVNO, placing our expert teams on site, and taking charge of the service rollout while they build up the mobile team. Petey in our team was responsible for Comcast’s go-to-market effort when launching Xfinity Mobile. Philip has delivered about a dozen successful Broadband+MVNO combos. Our group company www.mobileconclusions.com specializes in MVNO.

David & George