Cable One’s CEO says mobile will stem subscriber losses and raise service adoption

Broadband and video hits and misses

While Cable One has high hopes for its mobile service, the near-term reality is that it experienced higher broadband and video churn in the third quarter.
The cable operator cited competitive pressures, promotional roll-offs, and billing migration activities for the quarter's downturn.

“Given the economic and competitive pressures in the market, we believe some customers were susceptible to promotional roll-offs and to touch points tied to our billing platform transformation,” Laulis said. “Like our systematic efforts to drive new connections, we are taking an equally aggressive approach to addressing churn.”

Residential data customers declined sequentially by 21,600, ending the quarter with 910,410 subscribers. Likewise, Cable One lost 6,600 video and 3,700 voice subscribers, ending the quarter with 89,600 and 58,400 customers, respectively.

“Our subscriber results in the third quarter were weaker than expected, reflecting higher churn from the combined impact of macroeconomic factors, competitive pressures, promotional roll-offs and billing migration activities,” Laulis said.

She added that while “overall customer losses were disappointing, we saw modest improvements in third quarter connects as compared to the prior year period, a trend that carried into October.”

Aligning products and customers

Cable One is not taking the churn issue lying down. As Cable One aligns its products with customer needs, it is also advancing a new customer segmentation strategy.

The service provider has updated its pricing and introduced a slate of new offerings, including its low-cost Lift product, designed for households that previously received discounted service under the FCC’s now-defunct Affordable Connectivity Program (ACP).

Available now across most of Sparklight’s service area, Lift Internet is priced at $29.95/month for households that qualify through federal assistance programs. The plan includes a free modem, free standard installation and requires no credit check.

“Our Lift product, positioned as a value-by-need offering, resonates with cost-conscious customers, providing a sustainable path to reach additional households and expand penetration,” Laulis said.

She added that Cable One is seeing growing momentum in its higher-speed offerings. “We are also seeing strong sell-in among our premium tiers, with about half of new customers choosing gig or faster speeds, including our expanding multi-gig offerings, up from roughly 40% sell-in last year,” Laulis said.

One bright spot in the mix was business data, which grew revenue 0.4% year over year. However, revenues declined 0.2% sequentially.

Todd Koetje, CFO of Cable One, said business data services “growth was driven primarily by our fiber and carrier segments, offset by some continued subscriber and pricing softness in the SMB segment.”

“The Fiber & Carrier segment benefited from strong sales momentum, higher connection volumes and our ability to capitalize on new market opportunities,” he said.

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