What's Happening?
A recent analysis of the broadband and cable market for Q3 2025 highlights ongoing challenges for cable providers, with subscriber losses continuing to grow. The report, conducted by New Street Research, attributes the slowdown to the termination of the Affordable Connectivity Program (ACP), which provided low-income households with a $30 monthly subsidy for broadband services. The program's end in mid-2024 has significantly impacted the ability of Americans to afford broadband, exacerbated by federal cuts to social safety net programs. The report notes that the residential broadband market added 480,000 subscribers in Q3 2025, which is an increase from Q3 2024 but still below pre-pandemic levels. Adjusting for the ACP impact, the subscriber numbers reflect a year-over-year loss of 180,000. The analysis also points to the rise of mobile-only households and slow move rates as contributing factors to the subscriber slowdown.
Why It's Important?
The end of the ACP has had a profound impact on the broadband industry, particularly affecting companies like Charter, which was a major beneficiary of the program. The loss of the subsidy has made broadband services less affordable for many Americans, potentially widening the digital divide. This situation is compounded by broader economic challenges, including cuts to programs like Medicaid and SNAP. The ongoing subscriber losses highlight the need for cable providers to adapt to changing market conditions, such as increased competition from fiber and fixed wireless access (FWA) services. The report suggests that industry-level net add growth needs to recover to pre-pandemic levels for cable subscriber growth to improve, but this seems unlikely in the near future.
What's Next?
Cable providers may need to explore new strategies to offset subscriber losses, such as enhancing service offerings or investing in infrastructure to compete with fiber and FWA services. The report indicates that subscriber growth could improve if household switching velocity increases or if FWA subscriber growth slows down, though neither is expected soon. Comcast is set to report its Q3 results on October 30, which may provide further insights into the company's performance and future strategies. Additionally, the broader impact of federal policy changes on social safety net programs could continue to affect the affordability of broadband services for low-income households.
Beyond the Headlines
The termination of the ACP and subsequent subscriber losses underscore the broader issue of digital inequality in the U.S. Access to affordable broadband is crucial for participation in the modern economy, education, and healthcare. The loss of the ACP may exacerbate existing disparities, particularly in rural and underserved communities. As the industry grapples with these challenges, there may be increased pressure on policymakers to consider new initiatives or subsidies to support broadband access for low-income households.
