Challenging the Broadband Status Quo

In 2023, broadband spending could taper off because of high-interest rates and economic challenges, but buildout expansions remain high. A few factors are driving this. Demand for household internet keeps growing. Leichtman Research Group (LRG) found that 90 percent of US households now get internet service, up from 84 percent in 2017. In addition, Dell’Oro forecasted that the broadband equipment segment would grow 5 to 7 percent in 2023. Jeff Heynen, vice president of broadband access and home networking for Dell’Oro, said, “The revenue growth this year shows the continued emphasis on expanding and improving broadband network capacity by operators as well as state and national governments.” As DSL customers dwindle, telephone companies and communities are amplifying fiber-based broadband. Despite supply-chain constraints and a tight labor market, RVA LLC’s annual fiber-to-the-home (FTTH) report revealed that fiber providers passed an additional 7.9 million homes in 2022. FTTH and fixed wireless access (FWA) will continue to challenge cable’s broadband lead. Wireless broadband has been a factor, growing to 903,000 in the fourth quarter. T-Mobile and Verizon added 524,000 and 379,000 new FWA subscribers respectively. New Street Research forecasts that though FWA could peak in 2023, FWA is pressuring cable.