AT&T, Verizon and CenturyLink may still be dominant broadband players, but their broadband empires were challenged in the third quarter.
During this period, Leichtman Research Group reported that traditional ILECs lost nearly 140,000 subscribers, a reversal of the 110,000 gain it saw in the third quarter of 2014.
At the top of the list are AT&T (NYSE: T) and Verizon (NYSE: VZ). These two telcos collectively added a total of 305,000 U-verse and FiOS broadband subscribers, but lost 432,000 DSL subscribers.
Specifically, AT&T added 192,000 IP broadband subscribers in the quarter. Similar to Verizon, the telco also lost 278,000 legacy DSL customers.
Over at Verizon, FiOS continues to be the leading factor in its broadband business, with 114,000 net additions to end the quarter with a total of 6.9 million subscribers. However, this was down from Verizon the 162,000 net new FiOS Internet connections it added in the same quarter a year ago.
Due to ongoing DSL losses, Verizon's total high speed Internet customer base was 2.3 million, down 14.5 percent from 2.7 million in the same period a year ago.
CenturyLink (NYSE: CTL) also saw a disturbing downward trend in its broadband subscriber base, losing 37,000 broadband subscribers in the third quarter due to efforts to tighten the credit and collection policy on its broadband subscriber base.
Stewart Ewing, CFO and EVP of CenturyLink, said during the third quarter earnings call that the new credit policy contributed to 17,000 of the total 37,000 subscribers who dropped its broadband services in the quarter.
Despite the near-term losses, the service provider said that the policy may eventually enable it to reduce churn.
The news at Windstream wasn't exactly rosy either as the telco's broadband subscriber base declined by 32,500 to 1.1 million subscribers. In order to reverse its broadband losses, Windstream plans to dedicate $250 million to enhance its last mile network by installing VDSL2 network equipment to support up to 100 Mbps in more of its rural markets.
Frontier fared somewhat better during the quarter, adding 27,200 net broadband customers to end the period with a total of 2.43 million broadband customers. The service provider has pledged to enhance broadband services in the three markets it will enter via the purchase of Verizon's wireline assets in California, Florida and Texas.
LRG noted that in the first three quarters of 2015, cable operators added about 2.3 million broadband subscribers, while telcos lost about 130,000 subscribers.
"While major providers now account for nearly 90 million broadband subscribers in the US, top cable providers added subscribers at a faster pace over the past year than they did over the prior year," said Bruce Leichtman, president and principal analyst for LRG. "Over the past year, cable companies accounted for 103% of the 2.93 million net broadband additions."
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