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Comcast (CMCSA) Offers Wireless Internet Backup for SMBs

Zacks Equity Research

Comcast Corp. CMCSA plans to strengthen the services it offers to small and mid-sized businesses (SMBs) leveraging on its wireless network. The largest cable MSO (multi service operator) is rolling out a new product -- Connection Pro -- which will enable SMBs to keep their businesses running in case of a power failure or loss of web connectivity.

Connection Pro will enable Comcast’s business customers to automatically receive a 4G LTE cellular connection if there's a network or Internet disruption. The battery backup will be available for up to eight hours for those using the MSO's hybrid fiber-coax (HFC) networks.

On Aug 17, 2017, Comcast completed the nationwide rollout of its wireless services under the Xfinity Mobile brand. Based on a Mobile Virtual Network Operator (MVNO) agreement with Verizon Communications Inc. VZ, Xfinity Mobile used Verizon's 4G LTE wireless network.

Xfinity Mobile is the nation’s first wireless service combining the nation’s largest and most reliable 4G LTE network with 18 million Xfinity Wi-Fi hotspots to deliver a great wireless experience, which is cost effective. With Xfinity Mobile, the company is making both home Internet service and mobile access available at a reasonable price.

Earlier, on May 8, 2017, Comcast and Charter Communications Inc. CHTR announced their joint wireless venture so as to better explore their opportunities, and accelerate and enhance each other’s ability to participate in the national wireless marketplace. The company also bought $1.7 billion in wireless spectrum at a Federal Communications Commission’s (FCC) Broadcast Incentive auction in April 2017 in order to bolster its wireless services.

Business Services has been witnessing strong momentum and continues to represent an attractive growth opportunity for the company. Evidently, in the third-quarter of 2017, Business Services revenues were $1,575 million, rising 12.6% year over year. Comcast has been aggressively targeting the small and medium-sized business (SMB) segment, which is the core area of telecom operators.

After tasting considerable success at the segment, Comcast has now been expanding its Business Services division to cater to large enterprises. In this regard, the company has acquired Contingent Network Services and also announced the creation of a new -- Enterprise Service -- division with the aim of providing managed business services that include broadband, Ethernet, voice, router, security, business continuity and Wi-Fi for Fortune 1000 companies.

Moreover, the partnership with Amazon Web Service of Amazon.com Inc. AMZN should further aid in catering to enterprise customers. We believe that Comcast’s present focus on large businesses will help it gain traction in the Business Services segment and also boost revenues.

Price Performance of Comcast

Comcast’s shares have gained 12.9%, outperforming the industry’s growth of 5.7% over the past 90 days. The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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