The wireless industry continues to transform itself. This is an exciting time in the pay TV industry with cable television companies like Comcast and Charter re-entering the wireless space. If you recall, this has been tried once before several years ago and failed miserably. Will it be successful this time? It could be, but not the same way as competitors like AT&T Mobility, Verizon Wireless, T-Mobile and Sprint. Let’s take a closer look.
Xfinity Mobile is the new Comcast wireless service. It’s been in the marketplace for the last few months. Charter Spectrum says they are going to join Comcast next year. One question I have is why are they waiting so long? Whatever the reason, the cable television industry is going back into wireless and hoping for a better result this time around.
The reason cable TV failed at wireless last time was because they were a plain old cable TV company offering a plain old wireless phone and service at a time when the wireless world was rapidly shifting to the next generation smartphones like iPhone and Android and using tons of wireless data.
Why cable TV like Comcast and Charter failed with wireless last time
This was reason for a stumble, but not for withdrawing from the wireless marketplace altogether like they did. However, cable TV competitors pooled their wireless spectrum and sold it to Verizon Wireless. Then they washed their hands of the whole wireless world and said they were out of it.
Of course, they were not alone. If you recall the Facebook wireless phone and the Amazon Fire Phone also entered the space at the same time and failed as well. It was thought at that time the wireless was a more complicated business to win at.
Fast forward and the wireless industry has changed dramatically. Today the bestselling devices are Apple iPhone and Google Android like Samsung Galaxy. Today, past leaders Blackberry and Nokia are not even part of the conversation. Today the use of wireless data is exploding.
This is even creating new opportunities for new companies with new and innovative ideas. This is the space where Uber, Lyft and countless other companies are entering and transforming their industries using the smartphone.
So, what should have happened last time was Comcast, Charter, Amazon and Facebook should have all re-engineered their new entry devices and strategy. Instead they all bailed. OK fine. We all said goodbye.
However, now both Comcast and Charter are re-entering the wireless space. Comcast with Xfinity Mobile and Charter with whatever they will eventually call their phones when they actually enter the space next year.
Why are they coming back to wireless? Based on their exit, I don’t think it was by choice. Instead, I think new competition is taking market share from the cable TV industry.
Top two pay TV providers are Comcast and AT&T DirecTV
AT&T’s sudden success in pay TV is forcing this loss. DirecTV has become a real competitive threat in pay TV and that will trigger many others into the space. After acquiring DirecTV, AT&T also created wireless TV or mobile TV, sending the signal over the AT&T Mobility network. Customers love this and it is changing the entire pay TV space.
This kind of event happens in industry after industry. It changes everything, sending yesterday’s leaders to the back of the line. As an example, think about Motorola, Nokia, Blackberry, or bookstores like Borders Books, Barnes & Noble, or travel agencies and so on.
AT&T’s rapid impact in pay TV is astounding. Today, the top two providers in the pay TV industry are Comcast and AT&T DirecTV. And Comcast is losing traditional cable TV customers at a rapid clip.
That is both a great growth opportunity and threat to the traditional cable television competitors. If they don’t get up to speed, cable TV competitors will continue to lose market share.
Why Comcast Xfinity Mobile is not marketing wireless TV
That’s why I think cable TV is going back into wireless. However, I am confused that Comcast is not heavily marketing their ability to offer this same mobile TV to customers. Instead, they are taking a simple strategy. They are simply offering wireless on an iPhone or Android to their cable TV customers. They don’t seem to intend to really compete head to head in the wireless market.
Perhaps that will mean they won’t be judged as harshly. Not on the same level as the leading wireless carriers. After all, Comcast is not a wireless carrier and apparently that’s not one of their goals. Instead, they are a reseller of Verizon Wireless with an MVNO agreement and are happy in that limited role.
Even though this does not make sense, this strategy may work for them. Rather than be a growing force in wireless, this may help Comcast lock in their customers. This could help them limit the damage that was occurring with competitors. And that may be their primary goal.
I don’t yet know what success will look like at Comcast and Charter over the next couple years, or how much wireless market share they will earn. At this point I don’t see them being a major competitor in wireless, but that does not mean they will be unhappy. They don’t need to be a major winner in wireless. All they need is to slow their loss of customers to competitors.
In coming years, I do expect other cable TV companies to jump into wireless as a reseller as well. That’s if Comcast and Charter are successful this time.
It will be interesting to watch the transformation in cable TV in wireless over the next few quarters unfold. So far, Comcast seems to be doing well in their limited wireless strategy. Perhaps this time will be better. Can they keep it up? That’s the big question. I hope so. Let’s wait and see.
