Market share shifts between cable and telco providers tell part of the story of the broadband industry's health and vibrance, but the effects of new household formation on subscriber growth -- a somewhat unappreciated metric -- tell much more, according to a top industry analyst.
In a new report, MoffettNathanson analyst Craig Moffett said broadband growth would have slowed considerably in 2018 if not for the strength in new household formation, which grew 1.3% in Q4 2018 alone. By his estimate, new household formation accounted for about 44% of the 2.7 million industry net adds in 2018.
"The stronger growth in broadband is not somehow tarnished by the fact that it owes to a macro driver like growth in occupied dwelling units. But it is important to understand the source of the industry's growth," Moffett explained.
With respect to market share trends, US cable operators again "won" Q4 2018, as MSOs tacked on 841,000 net broadband adds in the period, up 4.9% year-on-year. The telcos lost 145,000 subs, down 1.3%, while satellite broadband service providers added 28,000 net subs, up 9%. When they are all combined, US broadband providers raked in 724,000 net adds in Q4, up 2.9%.
And despite the recent introduction of speedy, fixed wireless services aimed to disrupt the wired, in-home broadband market, there were "no signs of wireless substitution (either fixed or mobile)," in Q4 2018, Moffett wrote.
For more about Moffett's analysis of the broadband market following the recent wave of Q4 results, please see the story on our sister site, Light Reading. (See 'No Signs of Wireless Substitution' for In-Home Broadband in Q4 – Analyst .)
— Jeff Baumgartner, Senior Editor, Light Reading