Bernstein's Peter Supino Says Telephone Companies Better Positioned to Chip Away at Cable's Broadband Lead

While cable operators grapple with the slowdown of broadband subscriber additions expected in the third quarter and beyond, Bernstein media analyst Peter Supino said that telephone companies, long the butt of jokes about the sluggish speeds and poor service inherent in their core digital subscriber line (DSL) service, have streamlined operations and are positioning themselves to take back significant market share. Supino pointed to AT&T’s spinoff of DirecTV, Frontier Communications’ emergence from bankruptcy, Lumen’s (formerly Century Communications’) sale of about 7 million passings to Apollo Global Management and T-Mobile’s successful integration of Sprint, and how those moves have freed up their respective balance sheets to invest in fiber-to-the-home networks and technology to bring faster, more reliable broadband to residential customers. Tack on investment in C-band spectrum by AT&T, Verizon, and T-Mobile to extend fixed wireless broadband to harder to reach areas, and the outlook for telco service looks a lot better than it has in the past. “During 2021, each of AT&T, Verizon, Frontier, Lumen, and T-Mobile, in different ways, became a more viable contender for residential broadband subscribers,” Supino wrote, adding that he expects telco fiber-to-the-home (FTTH) broadband passings to rise 50% from 51.1 million in 2021 to 77.1 million homes by 2025.