Comcast said it plans to offer a mobile phone service this year with an emphasis on selling bundles of wireless and cable service.
Launching the wireless product is a priority in 2017, Comcast CEO Brian Roberts said in an earnings call today. Comcast will be able to offer wireless service nationwide because of a reselling agreement with Verizon, but the company is expecting particularly good sales with existing customers in its cable territory.
“We plan to include wireless in our multi-product bundles in a way that is designed to add value to our customers, improve retention, and ultimately benefit lifetime customer economics for us,” Roberts said.
“Our offering will give customers access to a world-class wireless network, benefiting from our Wi-Fi [hotspots], with the best mobile devices and a simple, transparent experience, all for a great value.”
Triple-play bundle from Comcast
The Comcast “triple-play” bundle would thus expand to four major products: home Internet service, cable TV, landline phones, and mobile phones. No prices were announced yet, but customers might be able to save money by buying fixed and mobile services from Comcast instead of separately from Comcast and a wireless company.
Comcast “will be measured in our rollout,” and adapt the service and offerings as necessary, Roberts said. The company expects to have a positive cash flow “on each incremental customer once we achieve a limited initial scale,” he said.
The selling point is that “it’s a great value proposition,” says Xfinity Mobile President Greg Butz. He adds that Comcast will work with several popular phones. “We know you’re not credible in this space if you don’t have Apple and the iPhone, Samsung and the Galaxy — we’ve got them.”
How these hotspots will work
The mobile devices would automatically find, connect to, and authenticate Wi-Fi connections. “The customer doesn’t have to worry if there’s a hot spot nearby,” Butz says. “All we want to do is just make it simple.”
He adds that customers “love Wi-Fi because it’s faster, it doesn’t count against their 4G LTE data threshhold, and they love Wi-Fi because they know if helps them save money.”
Comcast is aiming to launch the wireless service in the middle of the year.
Instead of building a cellular network from scratch, Comcast will be reselling Verizon Wireless mobile service thanks to a 2012 spectrum deal in which Verizon bought spectrum from cable companies. Comcast reportedly notified Verizon in 2015 that it would activate the wireless resale provision in that agreement.
Comcast also operates an extensive fiber network that could provide bandwidth for cellular service if the company wants to build a cellular network of its own to supplement Verizon’s.
Customers will be able to buy smartphones from Comcast just as they do with today’s major wireless carriers. “Our approach will be to purchase the phones and collect handset-related payments from our wireless customers over time,” Comcast CFO Michael Cavanaugh said.
Responding to a question about consumer frustrations connecting to and receiving decent service from public hot spots, Watson acknowledged that “Wi-Fi today is not what it should be. There’s no question. We have room to improve.”
But Comcast’s “aspiration is to constantly improve the Wi-Fi experience,” he adds. “It should be easier. And we’re not going to stop — we’re going to keep at it….We want to redefine Wi-Fi. Part of it is the experience and making it simple and easy. We’ve got work to do. But there’s a big upside, and it’s something we’ll do well.”
Comcast is the largest US cable company, with 28.6 million customers in 39 states and Washington, DC. Of those, 24.7 million subscribe to high-speed Internet, 22.5 million have cable TV, and 11.7 million have Comcast’s wired phone service.