Broadband Market Outlook  

Broadband Market Outlook  

This week, Peter Supino, Senior Analyst, Managing Director at Wolfe Research, joined Fiber for Breakfast and shared his thoughts and insights into the key trends and market outlook for broadband. A November 2024 Wolfe research note suggested the strength the firm observed in Q3 2024 results for cable, telco, and broadband companies risked being illusory and that they advised clients not to extrapolate the strength they saw in Q3 as a sign of significant long-term growth. When lower numbers were just reported last week by the cable companies, it validated that caution. 

Supino went on to say that “it’s interesting in such a stable business in which customers generally just pay their bills every month, and the operators increase the price every year, and the cash flows tend to go up over time, it’s always surprising to us how volatile results can be in the net adds quarter to quarter, but more so in the last couple of years because of the rate of change in the industry has picked up.”

Broadband subscriber growth, he noted, is not keeping pace with the number of homes being built. Historically, you could see an obvious relationship between the expansion of cable footprints and the expansion of their subs. What they’re now seeing, he explained, is as these providers expand their footprints, they’re not growing their subs and that makes their businesses more capital intensive. Wolfe Research’s industry model shows net adds for the whole industry including fiber, DSL, and cable for home broadband in 2025 appears to come in below 2 million, where 2024 was around 2.2 million and 2023 was around 2.5 million. This is cause for concern with the incumbent providers.

When looking at fiber to the home (FTTH) expansion opportunity, Supino believes that the providers need to offer fiber to win, but having fiber alone will not be enough for them to continue to gain market share. He mentioned that along with offering fiber, a competitive mobile offer is needed to secure the win. 

Decisions…decisions. Supino mentioned that there are still discussions to be had, and decisions need to be made in the states. They want to make sure that this is a one-time investment, and they want to have critical infrastructure that is not only going to deliver ultra-fast broadband but provide critical infrastructure for future services.  

So, what is on the horizon? There are 14,105 existing providers today, with five new providers coming into the market every day. Supino says that they are starting to see a lot of market consolidation. Frontier, recently acquired by Verizon takes their combined footprint into the high 40’s (millions of subscribers). T-Mobile’s fiber footprint is expected to reach 12-15 million homes by 2030 and with their recent M&A activity and joint venture strategy, they too will expand their footprint and service offerings.

Click here to learn more about this research and listen to other Fiber for Breakfast episodes.