Unlike many of its cable peers, WideOpenWest (WOW!) isn’t seeing a lot of competition from fixed wireless access (FWA) providers in its markets. The reason, according WOW! CEO Teresa Elder, may be because FWA providers are more focused in underserved broadband areas rather than markets where WOW! offers service. “We don’t see as much competition as our peers from fixed wireless,” she said, adding that WOW! is already bringing a lot of “competitive intensity” to its markets.
WOW! added 2,200 high-speed data (HSD) customers, or revenue-generating units (RGUs) in 2Q 2022, bringing its total number to 517,200. The company also said it now passes 1.886 million homes, the same number it reported at the end of Q1, but an increase from 1.877 million that it reported in the same quarter a year ago Overall, the company reported 536,600 total subscribers, up from 534,700 at the end of 1Q.
WOW! reported total revenue of $176.1 million, down $5.8 million or 3%, compared to the same quarter in 2021. The company said its net income was $4 million and its profit margin for the quarter was 2.3% compared to 4.3% during the second quarter of 2021.
WOW! touted the fact that its HSD revenue for the quarter was $102.6 million, an increase of $3.9 million, or 4%, year-over-year. But while HSD revenue is up, video revenue was $47.7 million, down 14% year-over-year and telephony revenue was $12.9 million, a 12% drop year-over-year.
Elder attributed the increase in HSD revenue to the increase in subscribers and also because many existing customers are moving to higher tier plans. In addition, Elder said that the company instituted a “marginal” rate increase in March. “Customers are taking higher speed plans. They are buying 500 Mbps and above plans,” she said.
Elder reiterated that the company’s greenfield buildout is under way in central Florida and beginning in Greenville County, S.C. In May the company increased its investment in its greenfield build and said that it expects to reach 150,000 locations in its two initial Florida markets of Seminole and Orange County and add nearly 30,000 new locations in its greenfield deployment in Greenville County.
She also said that WOW!’s edge-out markets are showing signs of success with the 2021 edge-out markets already reporting a penetration rates of 40% while 2022 edge-out markets already have penetration rates of 14% within the first 100 days of availability.
The company adjusted it guidance for Q3 and the full-year 2022. It now expects its HSD revenue to be between $415 million and $419 million for 2022 and its HSD net additions to be between 12,000 and 15,000 for the full year. It also expects its total revenue to be between $704 million and $708 million for the full year.
When asked for an update on a potential sale of the company, Elder declined to comment. In May Bloomberg reported that the company was in discussions to sell its business to Morgan Stanley Infrastructure Partners.
Mobile is an add-on
WOW! launched a mobile service in June powered by MVNO aggregator Reach Mobile. Mobile customers don’t need to be a WOW! customer to sign up for the no-contract cell phone service but existing customers do receive a $10 discount off their monthly bill. Elder didn’t provide any mobile subscriber numbers but said that the company views it as an “add-on” service and an opportunity for customers to get a discount. “It’s not a core offering as it is with some competitors,” she said.