Suddenly, there's real competition for broadband internet
Broadband in the US is a great, high-margin business with limited competition. But now the telco companies are trying to grab a piece of it via 'fixed wireless.' Spectrum advertised its broadband service during this year's Super Bowl. That must mean it sees T-Mobile and other competitors as a real threat.
The Rise of 'Fixed Wireless' Broadband
Telco companies in the US are entering the broadband market through the adoption of 'fixed wireless' technology. This technology allows customers to access broadband services via 5G airwaves using a box placed in their window, instead of relying on traditional cables. This provides more options for internet users and has the potential to increase competition in an industry dominated by a few providers.
There has been speculation about the viability of fixed wireless as a widespread solution, given concerns about its capacity to serve large numbers of users and its economic feasibility. However, the success of wireless carriers like T-Mobile and Verizon, who have gained 7 million fixed wireless customers combined, suggests that this technology is gaining traction and posing a real challenge to traditional broadband providers.
The Concerns of Broadband Providers
While the broadband industry has enjoyed limited competition and high profitability, the emergence of fixed wireless has raised concerns among providers. The growing number of fixed wireless customers, particularly those coming from cable companies, indicates a shift in consumer preference.
Notably, Spectrum, the second-largest broadband provider in the US, ran an advertisement during the Super Bowl specifically targeting T-Mobile's rival program. This move suggests that Spectrum sees T-Mobile and other wireless carriers as genuine threats to their core business.
The Battle for Customers
Broadband providers, such as Spectrum and Comcast, have been engaging in advertising campaigns to highlight the advantages of their internet services over wireless alternatives. These campaigns aim to reassure customers that broadband offers superior bandwidth and is better suited to meet their family's needs.
The fact that broadband providers are willing to spend significant amounts on Super Bowl advertisements indicates their growing concern about the competitive landscape and their desire to protect their market share. While questions remain regarding the scalability and cost-effectiveness of fixed wireless, the cable industry can no longer afford to underestimate the threat posed by wireless carriers.
