Charter notches 119,000 new internet subscribers in March due to free offer

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Thanks in part to a 60-day free internet access program, Charter Communications added 119,000 internet subscribers last month. (Pixabay)

According to a Tuesday 8K filing with the Securities and Exchange Commission, Charter Communications added 119,000 new internet subscribers last month. Charter is offering free internet access for 60 days during the coronavirus pandemic, so it remains to be seen how many of those new subscribers will stick with it after the free access ends.

The spring and summer months have traditionally led to seasonal churn in broadband subscribers for both cable and telco providers.

Aside of those net additions last month, Charter said in its filing that paying net adds also increased in March compared to the same month a year ago. Aside of the free offer, service providers in the U.S. are riding a wave of increased broadband usage as employees and students have became house bound due to COVID-19 restrictions.

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With increased investments in new broadband access technologies, such as DOCSIS 3.1, U.S. cable operators are well positioned to serve the increased demand for bandwidth capacity due to the COVID-19 crisis. Cable operators such as Comcast and Charter have dominated the broadband residential broadband space for years now.

"The increase in paying customers speaks to the value of broadband in the current environment and cable’s product advantage," according to New Street Research. "Cable has been taking share in residential broadband for a decade. We aren’t at all surprised to see the pace of gains accelerate in an environment where the utility of the service is highlighted. We don’t expect this to reverse."

While New Street Research didn't have information on the number of broadband subscribers that Comcast may have added last month, it did say that Charter's results echoed Altice's. Altice customers have been connecting their broadband services at their summer homes earlier than normal this year.

RELATED: Broadband usage hits a record high on Easter Sunday—OpenVault

While broadband numbers for cable subscribers look to be on rise during the coronavirus pandemic, New Street Research said some of those increases could be off-set by accelerated pay-TV declines, business failures and a reduction in advertising.

"With roughly 70% of EBITDA coming from residential broadband, and with residential broadband expected to grow at a robust high-single-digit rate right through a recession, U.S. cable companies are very well positioned to weather the storm," according to New Street Research.

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