Last year was a tough one for cable, with broadband net additions dropping dramatically in a shift that was attributed to both lower move activity and competition from fixed wireless access (FWA) offerings. But it seems the tide could turn back in cable’s favor in 2023, at least according to a new forecast from New Street Research (NSR).

T-Mobile and Verizon appear poised to deliver strong net additions in Q4 2022. The former already announced it added 524,000 FWA subscribers in the quarter. And while Verizon hasn’t yet disclosed its net add numbers, CEO Hans Vestberg recently pointed to its 300,000+ FWA net additions in Q3 and said “We continue with a good journey in the fourth quarter.” Cable is braced for impact, with Comcast warning on Q3 earnings that it could close the year with negative net additions.

But in a new research deck sent to investors, NSR predicted the tidal wave of FWA net additions will crest this year and start to recede thereafter. The trick, however, is figuring out exactly when that will happen.

The analyst firm laid out three scenarios for how FWA net additions might trend, focusing on Verizon and T-Mobile given they are currently the dominant players in the space. Its base case assumes Verizon will continue to gain customers, with some coming from T-Mobile and some incremental. If this happens, NSR said FWA net additions will peak in Q2 2023 and fall sharply by Q4.

“This will make for improved adds at Cable in the second half of 2023,” NSR wrote. “The major driver of the deterioration in the business outlook for Cable in 2022 will clearly be reversing as we exit 2023.”

NSR also laid out a more pessimistic scenario in which broadband net additions slow industry-wide to offset the explosive growth seen during he Covid-19 pandemic. In this case, fixed wireless gains could continue through late 2023, with cable potentially posting negative net additions in Q3 as a result. Thereafter though, FWA growth would slow, leaving room for cable to make gains heading into 2024.

“It is possible that the peak will only come in 4Q23 though. If so, the recovery in Cable broadband could only come in 1Q24 which will be visible to investors in April 2024,” they warned.

In terms of who stands to benefit the most, NSR pointed to Charter. That’s because “it is close to being a broadband pure-play, and because it is levered,” they wrote. Comcast will also benefit, but less so because it is less levered and could “face challenges at NBCU if we end up in a recession.”

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