How state-level subsidies might refill cable's broadband subscriber tank

With US cable broadband subscriber growth remaining flat or going negative, operators are hard-pressed to find a remedy that will rekindle growth in a service category now considered central to the overall business. Analysts at MoffettNathanson are attributing cable's recent broadband subscriber woes to market saturation and market share loss to fiber and fixed wireless access (FWA). To remedy the broadband subscriber issue, analysts expect US cable operators to accelerate buildout through voluntary edge-outs and participation in programs that subsidize network expansions into underserved or unserved areas, which are largely rural. While Charter was already a big winner in phase I of the Rural Digital Opportunity Fund (RDOF), analysts point out that both Charter and Comcast are now securing a "steady stream of state-level grants for network expansion with state-level subsidies." Cable's more aggressive involvement in state-level broadband subsidy programs signals a major change, as telcos have tended to be the largest participants in such programs. Though the reported state-level amounts won by cable have been relatively small or modest, they are "just a warm-up" for the much larger subsidies on tap for next year and beyond that will be appropriated under the Infrastructure Investment and Jobs Act (IIJA).