An SEC filing Comcast published today showed that Xfinity Mobile has been adding subscribers quickly. In the last quarter, Xfinity Mobile added 261,000 new lines. Overall, Xfinity Mobile had a net increase of 816,000 lines in 2019, bringing its total subscriber count at the end of the year to slightly over two million lines. It’s now fair to say that Xfinity Mobile is one of the largest MVNOs in the U.S.
By my math, Xfinity Mobile’s subscriber base grew by about 66% in 2019. It will be interesting to see whether Comcast can keep that kind of growth rate going forward.
By one method of accounting, Xfinity Mobile looks unprofitable. However, the brand seems to be moving in the right direction towards profitability:
Cable Communications results include a loss of $116 million from our wireless business, compared to a loss of $191 million in the prior period.
One could argue that way of looking at the financials leaves out something important. Subscribing to Xfinity Mobile makes it harder for a Comcast customer to cancel their internet service. Looking exclusively at the balance sheet of Comcast’s wireless segment leaves out the benefits Comcast receives as Xfinity Mobile reduces churn in the company’s other product segments.
At the moment, Xfinity Mobile presents a pretty good value proposition for current Xfinity Internet customers. Going forward, I’m not sure whether Comcast will keep Xfinity Mobile’s prices competitive to encourage growth or increase prices to make each subscriber more profitable.
In October, the network evaluator Tutela released its USA State of MVNOs report. Most network evaluators only assess the performance of the Big Four carriers (AT&T, T-Mobile, Sprint, and Verizon), so it’s interesting to see Tutela assessing a wider range of carriers.
Near the beginning of the report, Tutela shares some reflections on how the MVNO landscape is changing:
MVNOs and MNO flanker brands in the US carved out a niche largely serving the needs of lower-income customers or those with particular data needs…in 2019, the landscape is rapidly shifting. Technological advancements have made the barrier for operating some kind of network much lower; the entrance of cable companies into the market have pushed MVNO service into the more lucrative postpaid segment; and multi-network MVNOs are innovating on the network side of the equation, rather than solely differentiating on price or customer service.
The approach Tutela used to evaluate MVNOs was in line with its usual methodology. The company crowdsourced performance data from typical consumers with the help of code embedded in Tutela’s partners’ apps. In the new report, Tutela primarily considers how well MVNOs performed in regions where at least three of the big four networks offer coverage. Tutela calls these core coverage areas.
Within core coverage areas, Tutela calculates the amount of time subscribers have service that exceeds two different quality thresholds. When service exceeds the “excellent” threshold, subscribers should be able to do highly demanding things like streaming high-definition video or downloading large files quickly. When service exceeds the “core” threshold, subscribers should be able to carry out typical activities like browsing or streaming music without trouble, but performance issues may be encountered with demanding activities.
Here’s Tutela’s visualization of the main results:
A chart of median download speeds shows a similar ranking among carriers:
The results aren’t too surprising. Verizon MVNOs come out near the top of the hierarchy, while Sprint MVNOs tend to come out near the bottom. Cricket Wireless has a good score for the core threshold but does poorly in terms of the excellent threshold. That outcome makes sense since Cricket throttles maximum speeds.
Possible selection bias
I often write about how assessments of network performance that use crowdsourced data may be vulnerable to selection bias. These results from Tutela are no exception. In particular, I wonder if the results are skewed based on how high-quality phones used with different carriers tend to be. In general, newer or more expensive phones have better network hardware than older or cheaper phones.
Xfinity Mobile takes the top spot in the rankings. Xfinity Mobile is a new-ish carrier and is restrictive about which phones are eligible for use with the service. I would guess the average phone used with Xfinity Mobile is a whole lot newer and more valuable than the average phone used with TracFone. Similar arguments could be made for why Spectrum or Google Fi may have an advantage.
To Tutela’s credit, the company acknowledges the possibility of selection bias in at least one case:
The second factor explaining Google Fi’s performance compared to Metro or Boost is the device breakdown. Although a broad range of Android and iOS devices work with Google Fi’s service, the network is targeted most heavily at owners of Google’s own Pixel devices…The Pixel devices use top-of-the-line cellular modems, which intrinsically provide a better cellular experience than older or mid-range devices.
Several MVNOs offer access to Wi-Fi hotspots in addition to cellular networks. I’ve been curious how much data carriers send over Wi-Fi, and Tutela’s results give an estimate. While Xfinity Mobile appears to have sent the largest share of its data via hotspots, it’s a smaller share than I expected:
Tutela data suggests that Xfinity Mobile has already succeeded in offloading over 6% of smartphone data traffic onto its Wi-Fi network – far more than any other network.
Tutela also shares a graph comparing hotspot usage among different carriers:
There were a few other bits of the report that I found especially interesting. In one section, the report’s authors reflect on the fast growth of MVNOs run by cable companies:
Xfinity Mobile and Spectrum Mobile captured nearly 50% of the postpaid subscriber growth in Q2 2019, and combined added nearly as many postpaid subscribers as host network Verizon.
In another part of the report, Tutela shares a map displaying the most common host network that Google Fi subscribers access. It looks like there are a decent number of areas where Sprint or U.S. Cellular provide the primary host network:
While Xfinity does have decent options (especially if you don’t need too much data) – it isn’t necessarily very different from other MVNO’s.
Let’s dive into that. It’s not always possible to make apples-to-apples comparisons among carriers since each carrier has its own way of structuring plans. Still, I’ll try my best to compare Xfinity Mobile’s prices to the best deals available from Verizon and other carriers that use Verizon’s network.
Low data use
Both the commenter and I think Xfinity Mobile may be a good option for people who don’t use a lot of data. For a base price of $12 per line, Xfinity Mobile offers a 5-line plan with unlimited minutes, unlimited texts, and 10GB of shared data. In comparison, a postpaid Verizon plan with 8GB of shared data, unlimited minutes, and unlimited talk would have a base price of $34 per line. It’s harder to make a close comparison with Verizon’s prepaid plans. 5 lines with 1GB of data each, unlimited talk, and unlimited text would have a base price of $30 per line. For 6GB of data on each line, the cost would be $32 per line.
If we look at individual plans rather than family plans, Xfinity Mobile still looks like a winner, but the competition is tighter. 2GB of data, unlimited talk, and unlimited text has a base price of only $24 per month with Xfinity. Verizon prepaid charges a base price of $30 for a plan with only 1GB. Verizon postpaid is a whole lot more expensive for a comparable plan. However, some Verizon MVNOs have similar prices. BOOM! offers 2GB of data, unlimited talk, and unlimited texts for under $30 per month. Total Wireless offers 5GB of data for a base price of about $33. Red Pocket offers 3GB of data for about $30.
Heavy data use
For heavy data use, Xfinity Mobile subscribers will probably want to turn to the carrier’s unlimited plans. These plans have a base price of $45 per line each month. At this point, Xfinity Mobile is no longer a clear winner, especially on family plans. With 5 lines on Verizon’s postpaid Start Unlimited plan, there is a base price of $30 per month. However, a single start unlimited line has a base price of $70, still a much higher rate than Xfinity charges. Visible, a flanker brand run by Verizon, offers unlimited plans for only $40 per month. Verizon MVNO Total Wireless has excellent prices on high-data allotment family plans. For example, 4 lines with 100GB of shared data come with a base price of about $24 per line.
Xfinity Mobile has extremely competitive prices for those who want service over Verizon’s network, don’t use a lot of data, and don’t mind being more tightly tied to other Xfinity services. For those who use moderate or large amounts of data (especially on family plans) Xfinity Mobile faces plenty of competition.
Xfinity Mobile has a bring your own device (BYOD) program, but only a handful of devices are eligible for the program.
BYOD-eligible Apple iPhone devices
The iPhone 6 and more recent Apple devices are likely to be eligible if they’re unlocked. However, iPhone models sold by certain carriers or in some regions of the world may still be ineligible. Xfinity’s online tool can be used to verify a specific device’s compatibility.
BYOD-eligible Android devices
Only a small number of Android phones are officially compatible with Xfinity Mobile.
Samsung Galaxy S8
Samsung Galaxy S8+
Samsung Galaxy S9
Samsung Galaxy S9+
Samsung Galaxy S10
Samsung Galaxy S10+
Samsung Galaxy S10e
Samsung Galaxy Note8
Samsung Galaxy Note9
Most Google Pixel devices
Most models of these devices will be compatible with Xfinity Mobile if they’re unlocked and were sold in the U.S. I still suggest confirming compatibility on Xfinity’s website.
Official details about devices Xfinity Mobile permits are shared in the carrier’s FAQ. Xfinity Mobile has expressed an intention to expand the number of devices on its Android BYOD list in the future:
Right now, not all Android devices are compatible with Xfinity Mobile, but we’re working behind the scenes on making this possible in the near future.
I hope Xfinity Mobile aggressively opens up its Android BYOD program soon, but I’m not sure it will happen. Here’s an excerpt from a complaint posted by a Reddit user in early 2019:
[Xfinity Mobile] promised that it [Android BYOD] was coming over and over and here we are over a year later and still nothing… We did finally get iPhone byop but not a peep about android. I feel a little lied to.
Xfinity finally started to offer limited Android BYOD support in July of this year. Since the beginning of the BYOD program, Xfinity has expanded its initial list of supported devices to include the Pixels, S10, S10+, and S10e.
Comcast’s cellular brand, Xfinity Mobile, appears awfully well priced. Somehow, Xfinity Mobile offers service over Verizon’s extensive network without the usual price tag. Unlimited minutes and texts are included for free in all of Xfinity Mobile’s plans. Subscribers just pay for data, and rates for data are reasonable. For $45 per month, a subscriber can get unlimited data. Alternatively, subscribers can purchase a set amount of data and share it among up to five lines:
1GB data – $12 per month
3GB data – $30 per month
10GB data – $60 per month
A family could get five lines of service with 10GB of shared data, unlimited minutes, and unlimited texts for a base price of only $12 per line. Purchasing a comparable family plan from Verizon would be far more expensive. Even other mobile virtual network operators (MVNOs) that run over Verizon’s network charge far more for similar plans. Why is Xfinity Mobile so cheap?
Lock-in with other Xfinity services
Only customers with active Xfinity internet service are eligible to sign up for Xfinity Mobile. Some people who would have used internet service providers other than Xfinity may now choose Xfinity internet so that they can sign up for Xfinity Mobile. Similarly, potential fees incentivize Xfinity Mobile customers not to cancel other Xfinity services:
$20 per line monthly charge applies if at least one of the following post-pay subscriptions are not maintained on the account: Xfinity TV, Internet or Voice service.
Competitors threaten Comcast. Like Comcast, Verizon’s Fios offers bundled TV, internet, and home phone service. Emerging technologies like 5G fixed wireless may create viable alternatives to conventional cable companies. By bundling several services together, Xfinity may make it more difficult for consumers to switch to competitors’ services.
Favorable MVNO terms
Xfinity Mobile is relatively new, but it already has a huge number of subscribers. While the agreements between MVNOs like Xfinity Mobile and host operators like Verizon are generally private, my impression is that MVNOs with large subscriber bases often receive substantially better rates than MVNOs with small subscriber bases. Xfinity Mobile may, in part, be able to offer low prices because it gets unusually good rates on access to Verizon’s network.
While Xfinity Mobile’s service is well-priced today, it’s not guaranteed to stay that way forever. We’ve already seen one revamp in Xfinity Mobile’s price structure.
I haven’t seen Comcast executives explicitly explain their rationale for launching a mobile service, so all I can do is speculate. If you have other thoughts about Xfinity Mobile’s pricing strategy, please leave a comment!