Mobile Is Replacing Pay TV as the Bundled Complement of Choice for Wireline Broadband

Xfinity Mobile
(Image credit: Comcast)

The share of U.S. homes with standalone broadband, that is internet not bundled with another service like pay TV or landline telephone, was up to 41% in the first quarter, according to Parks Associates.

That compares to 33% in the first quarter of 2018, with millions more U.S. households ditching bundled pay TV service over the three-year span.

However, with the number of U.S. pay TV homes now dwindling below 80 million—after exceeding 90 million just a few short years ago—a new trend has emerged among what remains of bundled telecom services.

According to Parks, which said it surveyed 10,000 households for its latest Home Services Dashboard report, mobile services are emerging as a popular bundling complement for wireline broadband, replacing pay TV. 

The research company said 19% of U.S. broadband households currently bundle mobile and home internet services, paying an average of $128 per month.

Parks Associates

(Image credit: Parks Associates)

Comcast, for example, said it experienced its greatest quarterly expansion for mobile in Q1, adding 278,000 lines, all of them through bundled offers. Both Comcast and Charter Communications have launched mobile services within the last four years. 

“Falling pay-TV subscriptions among consumers are negatively impacting bundles with other services—bundles with four or five services in particular are losing their value,” said Kristen Hanich, senior analyst for Parks Associates, in a statement. “However, a growing crossover between mobile and home broadband services is helping to stem the gap. The fastest growing segment of these bundles is a standard double-play combining home internet and mobile service.”

Of course, with the number of standalone broadband subscriptions higher than ever, pricing has increased. 

Notably, these homes are paying an average of $64 a month for broadband service—an uptick of more than 64% over the average $39 they were paying in 2011, when the practice of bundling video with broadband was much more widely adopted.

Parks believes that average price will soon rise even further. 

The research company said 24% of U.S. broadband households reported plans to upgrade their home broadband in the next six months, which would drive broadband service ARPU upwards 5% year-over-year.

Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!