Over the past few months, Comcast (CMCSA) has suffered from an unexpected change in customer behavior.
While it was expected for the telecom giant to see a dip in cable customers during the fourth quarter of 2024 due to the rise of streaming services, a significant decrease in internet customers wasn’t on the company’s bingo card.
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In Comcast’s latest earnings report, it revealed that while its broadband revenue increased by 3% year-over-year during the last few months of 2024, it lost about 139,000 broadband customers, which is more than the 100,000 loss the company had previously forecasted.
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During an earnings call on Jan. 30, Comcast President Mike Cavanagh said the loss was “disappointing and worse” than previously expected.
He also said that the steep loss in internet customers was partially due to the discontinuation of the Affordable Connectivity Program (ACP), which ended last February. It was a government program that offered eligible households a discount of up to $30 a month for internet service.
Cavanagh also flagged that Comcast, which offers internet under the name Xfinity, is facing “intense” competition in its broadband business, especially when it comes to fiber internet, since competitors have larger coverage areas.
Comcast unveils new deal to win back customers
Amid this concerning trend, Comcast has decided to roll out a five-year price lock for Xfinity plans. Prices for internet plans range between $55 and $105 a month, and they don’t require an annual contract, which grants customers the ability to cancel anytime without penalty.
Comcast tries to woo customers with a multi-year price lock.
Image source: Bloomberg/Getty Images
“We’re addressing two significant consumer pain points – rising costs and transparency – with incredible value and easy-to-understand pricing that is locked in for five years,” said Steve Croney, chief operating officer of connectivity and platforms at Comcast, in a press release.
Customers who enroll in an internet plan with the price-lock guarantee also receive unlimited data and an unlimited Xfinity Mobile line at no extra cost for a year.
The new offer from Comcast comes after it announced in December that it will raise prices for its Xfinity services this year due to “strategic investments” to make its network “smarter, faster and more reliable.”
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Comcast also recently reduced Xfinity’s monthly autopay discount for credit and debit card payments from $5 to $2.
Comcast’s recent pricing adjustments have frustrated customers to the point where some are contemplating switching internet providers.
Consumers are struggling with internet bills
Many consumers across the country have been feeling the brunt of inflation and higher costs of living in recent years, so it is no surprise that another price increase would be the last straw.
According to a survey from U.S. News in October last year, the average internet bill at sign-up is about $81 in the most populous states. That’s slightly higher than what U.S. News found in its survey in April 2024, which showed that the average initial internet bill nationwide was $77.
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Also, 53% of Americans in the survey said the higher cost of groceries and other household products has restricted their budget to the point where they struggle to pay their monthly internet bill.
Comcast’s decrease in internet customers also comes at a time when Verizon, AT&T, and T-Mobile are all offering their customers fixed wireless access (FWA) internet service. FWA internet provides a high-speed connection that uses radio signals instead of cables.
It can provide internet access to remote or underserved areas where internet through cable is not available. FWA internet is also offered at a cheaper price than traditional internet services, which is giving Comcast major competition.Â
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