Altice USA CEO Dexter Goei said he expects to see further consolidation in the broadband business as companies look to build out their fiber networks, telling an industry audience at the Paley Center for Media’s virtual International Summit Wednesday that fixed wireless operators could get involved in the fray.
Goei knows of what he speaks. Altice USA’s former parent, Altice N.V., got its foothold in the U.S. market through acquisitions, first buying Suddenlink Communications for $9.1 billion in 2015 and Cablevision Systems for $17.7 billion later that same year. Lately, Altice USA has focused on smaller tuck-in deals — like its 2020 purchase of Service Electric Cable TV of New Jersey for $150 million and its $310 million deal to buy Morris Broadband earlier this year — although it did pair up with Rogers Communications in a failed $8 billion bid for Canadian telecom and cable operator Cogeco Communications in 2020.
“It’s very clear that in the broadband space, as it is in the media space, size does matter,” Goei said at the Paley Center conference. “Having more connectivity with your clients across multiple products and multiple services as much as possible is important.”
Goei added that while there have been several recent deals focused on the cable and fiber space, he sees future M&A activity including fixed wireless operators as well.
“I do suspect there will be more consolidation in the cable space and in the fiber space as more capital keeps on getting thrown at upgrading networks across the country,” Goei said. “However, something I’ve been talking about for quite some time is fixed wireless consolidation. We’ve seen it pretty much in all developed world economies for quite some time. We are where we were probably a year or two ago — in the early innings.”
Goei said he believes the industry is in the middle innings of convergence from a product standpoint, but added that as companies like AT&T and Verizon Communications build out fixed wireless and fiber networks, and wireline broadband providers Altice USA, Comcast and Charter Communications are expanding their product lines with wireless service, something‘s got to give. At some point, the best way to rapidly deploy the necessary infrastructure may be to buy it rather than spend the time and money building it out.
“So, size does matter, and I expect our sector to see consolidation, as it has for the last few years, continue going forward,” Goei said.
