Altice Mobile launches its wireless service at $20/month

Altice USA today officially launched its infrastructure-based MVNO mobile service in the U.S., as the latest cable operator to join the wireless fray.

The operator is offering unlimited plans at a locked-in price of $20 per month to current Optimum and Suddenlink customers; those plans will stay at that price as long as users keep their Altice Mobile service.

Non-customers that live within or near Altice’s 21-state Optimum or SuddenLink footprints can get the wireless service for $30 per month, which features unlimited data, text, talk, mobile hotspot, and video streaming. It also includes unlimited international text and talk from the U.S. to more than 35 countries, as well as unlimited data while traveling abroad in those same areas.

The cost of Altice Mobile’s wireless service undercuts other cable operators Charter Communications' and Comcast’s unlimited mobile plans, which are offered to the companies’ existing broadband customers for $45 per month.

Jeffrey Moore, principal at Wave7 Research, indicated both of Altice’s pricing options should draw in customers.

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“Whether the pricing is $20/month for Optimum and SuddenLink customers or $30/month for other customers, these are very attractive price points that likely will win Altice Mobile a good flow of customers, as we have seen with Xfinity Mobile and Spectrum Mobile,” Moore told FierceWireless, noting it’s a different pricing model than Comcast's and Charter’s split of by-the-gig versus unlimited plans.

Moore also called the pricing for life “a good move, as it removes the objection that this could be an ‘exploding offer.’”

In a Thursday note to investors Wells Fargo analysts pointed out that Altice’s $20 per month price point is “the most aggressive in the wireless industry” when it comes to single-line plans.

“ATUS should be able to gain market share at these price points, particularly right before a seasonally high-volume Q4 for wireless phone activations,” wrote Wells Fargo Senior Analyst Jennifer Fritzsche.

Altice is offering a BYOD option, that Moore expects the company will “likely focus significant effort” on, noting it’s worked well for Xfinity Mobile and Spectrum Mobile.  Eligible Optimum and Suddenlink customers can also opt to purchase new smartphones from Altice at retail stores, including handsets from Apple, Samsung and Motorola on 36-month equipment installment plans.

A different flavor of MVNO

Both Charter and Comcast operate as MVNOs running on Verizon’s network, but Altice’s infrastructure-based MVNO with Sprint is different in that Altice owns and operates its own mobile core.

Moore pointed to the construction of about 20,000 Sprint small cells in Altice areas as a positive differentiator for Altice Mobile over its cable MVNO counterparts. These “will likely lead to blazing speeds in some areas,” Moore said in emailed comments.  

Altice also inked a roaming deal with AT&T, which Altice said combined with its two million Wi-Fi hotspots and Sprint’s 4G LTE network provides reliable 99% nationwide coverage.

Altice owns and provides the phone SIM, so Altice Mobile customers can use their same phone and SIM to switch between AT&T's and Sprint’s radio access network (RAN) depending on location, Altice USA Chief Operating Officer Hakim Boubazine said Thursday on a call with journalists.

Boubazine reiterated that Altice owns the core infrastructure and the SIM, saying Sprint and AT&T are really partners in that sense.

“What’s going to happen is we’ll provide at any time the best radio access network available at the given location,” he said. “There’s a logic we built into the core network, and it’s determined by really providing the best coverage and best capacity at any time.”

AT&T and Sprint customers also won’t be prioritized ahead of Altice Mobile users, according to Boubazine.

“Our customers will be treated exactly the same way as Sprint or AT&T customers,” he said, emphasizing that while it will use the carriers’ RANs, Altice controls all of the packet gateways and determines service and experience.

“There is no prioritization whatsoever, and in our agreements it stipulates that [Altice Mobile] customers get the same experience as the MNOs’ own customers,” he added.

While Comcast and Charter have struggled to yet turn a profit on their mobile efforts, CEO Dexter Goei said the company thinks Altice Mobile will be a profitable standalone business within 12 months following some launch-related light losses in the first year.

When it comes to Altice Mobile’s low price point, Goei said pricing in the wireless market today is not as attractive as it could be.

“We think we can offer our clients a differentiated experience and a differentiated price point,” Goei said. “We’re not pricing this to lose money or to gain market share, we’re pricing this as a standalone product we think we can make very attractive economics on.”