Altice USA Brings Gig Service to Broadway

Now that it's given its 1 Gig service tryouts on the road, Altice USA is bringing the service home to New York for its Broadway debut.

Altice USA , the fourth-largest cableco in the US with 4.9 million total customers, disclosed in its second-quarter earnings report Thursday that it recently began "a soft launch of a 1-Gig symmetrical internet-only service in select areas in the Optimum footprint." The launch followed successful beta trials earlier this year.

With the introduction of 1 Gig service in the New York region, Altice USA said it now offers gigabit speeds to 28% of its sprawling 8.7 million-home footprint, including 73% of the households in its legacy Suddenlink territories. The company plans to extend gigabit service to the rest of its footprint as it tries to match or exceed the broadband speeds offered in its markets by Verizon, AT&T and other rivals, especially in the fiercely competitive New York metro area.

Altice USA is also continuing to carry out its ambitious FTTH buildout plans as it seeks to fight fiber with fiber. With much of its Suddenlink territories already upgraded to FTTH, the company is now focusing on laying out new fiber networks in the New York area and expects to start "commercializing" those networks later this year. (See Altice USA Revs Up for Broadband Battle and Altice Amps Up US Capex for FTTH, New Box.)

Thanks in part to these latest network upgrades, Altice USA said it now offers data speeds as high as 400 Mbit/s to 88% of its homes passed, including 98% of its Optimum (Cablevision) footprint in the New York area. And broadband customers keep signing up for higher speed tiers, with more than 90% of new data customers now taking download speed tiers of 100 Mbit/s or more. Overall, 76% of the cableco's nearly 4.1 million broadband customers now take speed tiers of 100 Mbit/s or higher, nearly double the 39% who did so a year ago.

In another set of revealing customer metrics, Altice USA said the average broadband speed taken by its data customers rose to 162 Mbit/s at the end of June, up 74% from 93 Mbit/s a year earlier. At the same time, the average data usage per customer climbed over 220 gigabytes for the quarter, up more than 20% over the past 12 months, as subs tapped into their broadband services more and more. To cite a prime example, Optimum customers are now connecting an average of 10 Internet-linked devices in the home, with over 60% of them using more than 100GB of data per month.

Small wonder, then, that Altice One, like most other major broadband providers, is looking to improve its customers' home networking experience. Along those lines, the MSO is now deploying an advanced WiFi router and new WiFi mini-repeaters and plans to introduce a new "Smart WiFi" service by the end of the year.

Altice USA is making these moves as it continues to add broadband subscribers, albeit at a much slower base than other major US MSOs. With its legacy Optimum areas already highly penetrated for broadband, the provider picked up 10,000 data subs in the second quarter, up from just 2,000 in the same period a year ago. The Optimum areas accounted for much of that gain, contributing 8,000 net subs.

Broadband revenues rose to $712 million in the spring quarter, up from $643 million a year ago. Overall, Altice USA's revenue inched up to nearly $2.4 billion in the quarter as its video and telephony revenue fell, nearly offsetting the broadband gains. (See Altice USA: 'Wait Till Next Year!' and Altice USA Q1 Revenues Rise 1.8% to $2.36B.)

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• Altice Exports Fiber First Strategy to US

— Alan Breznick, Cable/Video Practice Leader, Light Reading