Frontier lost 107K broadband subscribers in Q1. For years, I've been expecting the low capex at Century, Frontier and Windstream would hurt, as their offering falls further and further behind cable. In most of the United States, cable's basic offering is 50-70 megabits down, 5 up. The three mid-sized U.S. telcos offer 5-40 megabits down to most, often at the lower end. Especially at Frontier, marketing has been deceptive. They advertise "up to 100 megabits" when the strong majority of their homes can't get even half that.

The future is now, perhaps. Frontier is down 107K in Q1, while Windstream and Fairpoint also fell.

Century was flat, presumably aided by targeted marketing to prevent them going negative as well. 

Telcos are beating cable in Canada and several European countries, so we need to find another explanation for why AT&T and Verizon are doing so badly. They intend to get rid of about 1/4th of their landlines and stopped any capex. ("Verizon decided a decade ago to build FIOS and go wireless only everywhere else," someone knowledgeable said recently. That corresponds to what Verizon's President, Larry Babbio, told Wall Street back then.) Something like10M remain that no one wants to pay for. Frontier bought many of them and is insolvent by some measures.

AT&T had modest growth, probably due to aggressive marketing with their DirecTV satellite. Verizon was down 27K, including weakness in FIOS territory. Verizon prices continue to be the highest in the developed world or close to it - $70+ the minimum in FIOS territory.

Both Comcast and Charter continue to roll, with over 400K net adds in the quarter.

Here's data from Leichtman Research, who has been consistently accurate in the past.  

ABOUT 960,000 ADDED BROADBAND IN 1Q 2017

There are now More Broadband Subscribers than Pay-TV Subscribers in the US

Durham, NH -- May 19, 2017 -- Leichtman Research Group, Inc. (LRG) found that the fourteen largest cable and telephone providers in the US -- representing about 95% of the market -- acquired about 960,000 net additional high-speed Internet subscribers in 1Q 2017.

These top broadband providers now account for 93.9 million subscribers -- with top cable companies having 59.4 million broadband subscribers, and top telephone companies having 34.5 million subscribers.

Findings for the quarter include:

  • Overall, broadband additions in 1Q 2017 were 85% of those in 1Q 2016
  • The top cable companies added about 1,000,000 subscribers in 1Q 2017 -- 90% of the net additions for the top cable companies in 1Q 2016
  • The top telephone companies lost about 45,000 subscribers in 1Q 2017 -- compared to a gain of about 10,000 broadband subscribers in 1Q 2016
  • Telco providers have had net broadband losses in seven of the past eight quarters
  • Over the past year, there were about 2,530,000 net broadband adds -- compared to about 3,035,000 over the prior year

"With the addition of nearly one million subscribers in the quarter, the top cable and Telco broadband providers in the US cumulatively now account for over 93.9 million subscribers in the US," said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. "In the first quarter of 2017, the number of broadband subscribers surpassed the number of pay-TV subscribers in the US."

Broadband Providers Subscribers at End 
of 1Q 2017
Net Adds in 
1Q 2017
Cable Companies
Comcast 25,131,000 430,000
Charter 23,051,000 458,000
Altice* 4,002,000 39,000
Mediacom** 1,179,000 17,000
WOW (WideOpenWest) 729,000 10,100
Cable ONE 523,327 9,419
Other Major Private Company^ 4,830,000 40,000
Total Top Cable 59,445,327 1,003,519
Phone Companies
AT&T 15,695,000 90,000
Verizon 7,011,000 (27,000)
CenturyLink 5,945,000 0
Frontier 4,164,000 (107,000)
Windstream 1,047,600 (3,500)
Cincinnati Bell 307,400 4,200
FairPoint 305,353 (1,271)
Total Top Telco 34,475,353 (44,571)
Total Top Broadband 93,920,680 958,948.

Latest

April 18

“My three biggest customers are marching to 7 and 5 nanometers.” Lip-Bu Tan. Moore’s Law ain’t dead yet.

Eric Xu, current Huawei Chairman, said consumers would find no “material difference between 4G & 5G.” Dozens of top engineers agree the "5G Revolution" is hokum, including  DT CTO Bruno Jacobfeuerborn, FT/Orange SVP Arnaud Vamparys, and BT CEO Gavin Patterson.
     Politicians and marketers pushed b_______. What’s coming for 5-10 years is good for telco capacity but otherwise disappointing. Unfortunately. 
     On the other hand, mmWave & Massive MIMO are improving at a ferocious rate, advancing telco capacity enormously. Massive MIMO has made it practical to use 3.5 GHz frequencies, a second remarkable booster. The "5G Revolution" is dead; Long Live the real 5G and advanced wireless!
============
U.S. attacks on Huawei and ZTE look to be an historic disaster.


China’s logical response is to invest to become independent of the U.S. They already have $100B on the table for memory chips and are rumored to add another $100B. Huawei/HiSilicon already holds their own against Qualcomm and everyone else in the world. 
    Zeng Xuezhong of Spreadtrum, world #3 mobile chipmaker, confirms: China will “speed up the chip R&D investment that is self-controlled and self-researched. We must never forget to make it bigger and stronger.”
     U.S. warships patrolling China’s seas inspire security fears. So does Trump’s threat to a country on China’s border."Military solutions are now fully in place, locked and loaded, [for] fire, fury and frankly power, the likes of which the world has never seen before.”
     China would be stupid not to have domestic capacity just in case. The Chinese leadership is not stupid.
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The year's best wireless conference is next week. Ted Rappaport, Sandeep Rangan and colleagues bring the world's best engineers to the Brooklyn 5G Conference Summit. This year, Paulraj, Onoe, Fettweis, Katabi, and their peers are coming. Do not miss the webcast, http://bit.ly/2HuOKqW .

April 10

A special report: Who Are The Three Billion? The Color Of The Net Has Changed http://bit.ly/netcolor
1/3rd wireless only, 2/3rds in Global South, 75% not native English speakers.