Altice USA’s Optimum has made its 8 Gbps Fiber Internet service available to over 1.7 million residents and businesses across its fiber-to-the-home (FTTH) footprint. By the end of the year, Optimum 8 Gbps Fiber will be available to nearly 3 million passings and expand as the company’s fiber network build continues.
Optimum claims this rollout represents the largest deployment of 8 Gbps internet speeds in the country. It cements Optimum as the nation’s largest 8 Gbps internet provider, delivering the fastest Fiber Internet available in its serviceable footprint. This makes Optimum a more significant threat to Verizon, Frontier and T-Mobile 5G Home wireless Internet service.
“After launching 2 and 5 Gig symmetrical Fiber Internet speeds last year, Optimum is pleased to have invested even further in our network and infrastructure to bring next level 8 Gig symmetrical internet speeds to our fiber footprint,” said Leroy Williams, Chief Growth Officer, Optimum. “Optimum is now the nation’s largest 8 Gig Fiber Internet provider, and availability will continue to increase as we deploy fiber to more homes and businesses as we solidify our position as the connectivity provider of choice across all the communities we serve.”
Backed by a Fiber Internet network, Optimum’s 8 Gbps Fiber Internet offers 8 Gbps symmetrical speeds to support data-intensive applications such as AR/VR, gaming, graphic design, and video production, all while providing increased bandwidth that can simultaneously connect 100+ devices to the internet at once. The service is delivered directly into the home via the Optimum Fiber Gateway to enable fast, reliable WiFi in the home or business, with extenders available for extra coverage.
The new 8 Gbps tier is being delivered over XGS-PON technology. “Optimum’s Fiber is deployed using XGS-PON, an advanced technology that enables multi-gigabit symmetrical speeds and that is superior to the legacy GPON standard used by many other fiber providers,” said Pragash Pillai, Chief Technology and Information Officer, Optimum.
Ramping up speeds
Optimum’s 8 Gbps debut reflects the cable MSO’s focus on continually ramping up available speeds on its FTTH network.
Today, the provider’s 1 Gbps symmetrical tier is available across its entire fiber footprint. Likewise, as of the end of the first quarter, multi-gig symmetrical speeds were available to 65% of the cable MSO’s East Fiber footprint.
The 1 Gbps (1 Gig) broadband or higher speed sell-in to all new customers, where 1 Gig or higher services are available, was 36% in the first quarter. Nearly 21% of the Residential broadband customer base currently takes 1 Gig or higher speeds, representing a significant growth opportunity for Altice USA.
Over the past year, the company introduced Optimum 5 Gbps (5 Gig) and 2 Gbps (2 Gig) Fiber Internet, with symmetrical data speeds up to 5 Gig and 2 Gig, respectively, in certain portions of its footprint.
Altice USA noted that broadband speeds taken on average have nearly doubled in the past three years to 412 Mbps in the first quarter. About 37% of broadband customers remain on plans with download speeds of 200 Mbps or less, representing a sizable opportunity to continue to upgrade speeds. Broadband-only customer usage averaged 625 GB per month in the first quarter, which is 25% higher than the average usage of the entire customer base (500 GB per month).
The company is also finding that bundling its gigabit service with mobile service is resonating with customers. Dennis Mathew, CEO of Altice USA, told investors during its first-quarter earnings call that bundling services will help it drive more customers to higher speed tiers. “Our approach is up tier customers to higher symmetrical Internet speeds and combining that in-home connectivity experience with mobile service positions us to take more share,” he said. “In light of this new converged strategy, our focus is on driving improved average revenue per account and customer lifetime value rather than individual product ARPU. You can expect to see more on this in the quarters to come.”
But Altice’s FTTH ambitions don’t stop at 8 Gbps.
Matthew indicated during the first quarter call that it will upgrade its network to support 25G PON and beyond when equipment becomes available. “Our current 25-gig plan will deliver true fiber 25 gig speeds both upstream and downstream once again highlighting the superiority of our fiber network,” he said. “We have a 50-gig and 100-gig plan we're working on as well via channel bonding and using time and wavelength division multiplexing, with the critical point being that we can very easily leverage our existing fiber network infrastructure that we're building today.”
Expanding FTTH reach
As it ramps up speeds, Altice USA is expanding the reach of the Optimum FTTH network. At the end of the first quarter, it had 2.37 million FTTH passings, adding 214,000 new FTTH passings.
Altice USA has been accelerating the pace of its network edge-outs, adding 48,000 passings in the first quarter, which is about one-third of the targeted new build network extensions for FY 2023. It said it remains on track to reach 150k 000 passings for the entire year. The Company continues to see strong momentum in growing customer penetration, typically reaching approximately 40% within a year of rollout In new-build areas.
Altice USA added (FTTH) broadband subscribers in the first quarter, which it said was its best quarter for fiber net adds and more than three times the growth compared to the 11,000 it added in the first quarter of 202. Higher fiber gross additions and increased migrations of existing customers drove fiber broadband net adds. Total fiber broadband customers reached 210,000 as of the end of the first quarter of 2023.
“We ended the quarter with 210,000 fiber customers and expect this will continue to step up as we broaden the availability of multi-gig services and have Optimum Complete as our primary offer,” Matthew said. “Our goal is to accelerate our fiber and mobile customer growth and penetration meaningfully.”
While Altice’s FTTH build is gaining steam, it saw broadband subscriber declines in the first quarter. It lost 19,000 broadband customers in the first quarter, up from 12,000 in the same period a year ago.
Matthew noted that it saw an additional 9,000 customers churn due to a rise in non-payment over the first quarter of 2022. “We did see a bit of an uptick in non-paid churn in the quarter, which we attribute to macro-related factors, which suggests that our underlying threads are improving.”