Consumers in central Florida are apparently hungry for fiber. It’s only been a few weeks since WideOpenWest (WOW!) started connecting customers in its first greenfield fiber market of Altamonte Springs but CEO Teresa Elder said it’s seeing strong uptake of its service, including its higher-tier products.
WOW! announced its launch in Altamonte Springs in January, noting at the time it had around 1,000 passings in the city. Speaking on the operator’s Q4 2022 earnings call, Elder said the market had already achieved a 25% penetration rate – which she noted was quite near the 30% rate WOW! was targeting in the timeframe of a year or more after launch.
While Elder acknowledged the penetration figure will likely fluctuate as more passings are added, she said it is “thrilled” with the early results.
“We know that these markets will be very accretive for us at 30% but we don’t know what the ceiling is,” she said. “I can look to some of our edge out penetration, some of those percentages are up in the 40%, 45% range. So, we feel very good about how our products are resonating in the markets that we’ve chosen.”
According to Elder, around 70% of WOW!’s customers overall are taking speeds of 500 Mbps or above, with more than 50% of its base subscribing to such tiers. CFO John Rego added up-tiering is happening not only within WOW! legacy markets but also in its greenfield territory. In its greenfield fiber markets like Altamonte Springs, WOW! offers speeds of 100 Mbps, 500 Mbps, 1 gig, 3 gigs and 5 gigs.
Rego said greenfield customers are coming in at “seriously higher tiers,” with a “goodly proportion” taking its 3-gig service. “I’d say the low-point offering for greenfield subs so far has been 500 meg,” he stated.
WOW! ended 2022 with around 1.9 million homes passed between its cable and fiber assets. Elder declined to provide a target for the number of greenfield fiber passings WOW! is looking to add in 2023. However, she did say it plans to ramp its expansion work significantly since a lot of the design and permitting groundwork needed to do so was already laid in 2022.
Metrics
Revenue in Q4 2022 rose 1.2% year on year to $180.5 million, though the company posted an operating loss of $12.7 million. High Speed Data (HSD) revenue rose 6.6% to $107.1 million, but that gain was more than offset by losses in WOW!’s video and telephony businesses.
It ended the quarter with 511,600 HSD subscribers, down 100 year on year and 7,000 sequentially.
For Q1 2023, it is forecasting HSD revenue of $105 million to $108 million and total revenue of $172 million to $175 million. It added it expects HSD customer additions to be between -4,000 and 0.