Comcast pursues new opportunities to offload wireless traffic to Wi-Fi

As Comcast expands its mobile wireless base, the cable MSO is moving to put more customer traffic onto the home Wi-Fi network. Today, Comcast’s mobile wireless customers consume about 17 gigabytes of monthly data. However, most of its home usage is the Wi-Fi network.

Through its MVNO relationship with Verizon, Comcast offers mobile and broadband bundle packages.

Brian Roberts, CEO and chairman of Comcast, told investors Goldman Sachs Communacopia + Technology Conference said it is offloading mobile traffic onto Wi-Fi to save consumer costs. “We have a capital-light model, and we are spinning up the ability to offload to save cost, even beyond that for consumers,” he said.

Roberts said Comcast has been able to put “a modest amount of capital” into prepping the Philadelphia market for a trial of cellular offload onto its network. Previously, Comcast purchased a large swath of CBRS Priority Access Licenses and had been testing CBRS in Philadelphia since 2018.

“Our offload tests are going well,” he said. “We've realized that 3% of our geography gets 60% of the bits in our network consumption. So, if this works, we're going to continue to be able to look at more markets, and I think we're in a good space.”

Escalating broadband use

While Comcast is keen on expanding its mobile reach, the cable MSO is seeing traditional broadband usage continue to ramp even as broadband subscriber growth remains flat.

In the second quarter, Comcast reported that 4.5% broadband ARPU growth drove domestic broadband revenue up 4.4% annually to $6.38 billion, despite the second quarter representing the sixth consecutive quarter of basically no subscriber growth, about 32 million.

In the last five years, Comcast has 13 times more attached devices to Wi-Fi. The cable MSO has 1 billion devices connected in its residential subscriber homes.

“What's that look like in 5 years? Is it constant or exponentially more?” Roberts said. “That's a good bet that Wi-Fi will power so much. If you look at our broadband usage, it's almost doubled in the last couple of years with COVID.”

Comcast estimates that the average non-linear video customer uses 700 gigabytes a month of data. Roberts intimated that the growing demand for streaming sports content like Sunday Ticket, the Big Ten on Peacock, Sunday Night Football, and an NFL playoff game in January will increase bandwidth usage.

“And what does all that [streaming content] need?” Roberts said. “That needs bandwidth and does not need freezing with the ball in the air. So, as people become more and more user-dependent on the dream of broadband and its capabilities, I think broadband will reinvent itself.”

While it is hard to predict if the average user will need them, Comcast is preparing the network to support symmetrical gigabit speeds for those who want them. “We're a company investing in DOCSIS 4.0,” Roberts said. “It will get us up to 10 gigabits bidirectional, unprecedented capability. Anybody's guess whether we need it at all, but I think most of us in this room will want it.”

Scaling wireless

Even as it moves to offload traffic onto Wi-Fi, Comcast sees an upside in scaling its mobile wireless subscriber base.

During the second quarter, Comcast saw that the growth in domestic wireless revenue was due to higher service revenue. This was driven by customer line momentum, up $1.4 million or 30% year-over-year, to $6 million, including the 316,000 lines it added in the quarter.  

By offering a converged bundle of broadband and mobile across its subscriber base, Comcast hopes to improve its broadband ARPU.

Roberts said that it is only “scratching the surface in wireless.”

“We're only 10% penetrated, so it's an unbelievable upside,” he said. “The bundle creates value for consumers to take the best broadband, so the story resonates.”