A new report from the Fiber Broadband Association (FBA) found rural move activity is biased in favor of areas with fiber-to-the-home availability. That could prove to be bad news for cable incumbents given the study also noted more consumers now say they’d prefer rural to urban living.
FBA’s report was conducted by consulting firm RVA LLC and based on an online survey of 3,000 consumers in March 2022. It found approximately 92% of U.S. residents are connected to the internet at home, with 77% on wired services and 15% on wireless. In terms of market share among primary residences, cable leads with 49% followed by fiber with 21.3%, DSL with 13.1%, mobile at 11.7% and fixed wireless access at 3.1%. Others have estimated cable’s market share at around 69%, but RVA noted its calculation does not include business customers, second homes or cable customers served by FTTH.
The survey found consumers across rural, suburban and urban living preferences cited “very high speed/reliable internet access” as a top priority, ranking this the third most important community attribute behind “safe streets/low crime” and affordable housing. Interestingly, it also noted more consumers now say they would prefer to live in a remote small town if they were able to get the level of internet access they need.
According to the report, 23.6% said rural living was their preference in 2022, compared to 14.3% previously. Another 44.7% said they’d prefer suburban living, up from 38.3%. Interest in urban living dropped from 32.6% to 18.3% while farm or wilderness living as a preference dropped from 14.3% to 13.4%.
Another metric from the report indicates consumers may be weighing fiber availability as a factor in their move decisions. It found that among those who moved into a rural area within the last year, 47% moved into areas with FTTH availability. That stat stands out because FTTH is only available in 31% of rural areas today.
Cable companies have repeatedly cited lower move activity as a factor contributing to lower net additions but have insisted they remain competitive when such jump balls do arise.
However, New Street Research recently found that cable companies are losing share in consumer decision-making, contributing to lower gross additions. “We estimate their share of gross adds (SOGA) has fallen from a peak of 74% at the start of the pandemic to close to 60%. With SOGA well below market share of 69%, cable is losing share,” New Street analysts wrote in a note earlier this week.
New Street also recently highlighted a slump in move activity in July, a trend which they noted hurts cable in markets where they’re replacing DSL and helps them in areas where they’re losing out to fiber and fixed wireless. “With 60% or more of their footprint in markets where they are gaining share, lower moves hurt Cable in aggregate,” they concluded.
Other interesting statistics from the FBA report include findings that 58% of broadband adopters in the past four years are low-income, 37% of adopters over the same period are non-white households and that low-density zip codes receive service with one-third the bandwidth available in high-density areas.