Both Verizon and T-Mobile have been touting fixed wireless access (FWA) of late as a way to help close the digital divide, take market share from cable companies and reap new revenues.
But the FWA players are being questioned about the desirability of FWA as compared to fiber.
The analysts at Cowen recently hosted Verizon CTO Kyle Malady, who admitted that fixed wireless is not fiber-like. But Verizon also has experience with fiber via its Fios product, which has been in place for eight years. Malady noted that consumers do not use or need anything remotely close to the 1 Gbps speeds that FiOS provides.
The Cowen analysts said that fixed wireless providers need to improve their consumer marketing. Currently, consumers seem to equate speed with quality and reliability. Of Malady’s comment about speeds, the Cowen analysts said, “We note this ‘more than enough speed’ stance has been endorsed by various ILEC/RLECs for years, and a valid point, yet a point that needs to be articulated effectively to consumers.”
Capacity limitations of FWA
The big wireless carriers are also being questioned about the capacity limitations of FWA. If their existing wireless infrastructure that delivers mobile connectivity must now also deliver FWA, will it have the capacity to do so?
The answer to that question may depend on whether the fixed wireless is in a rural or urban area.
Carriers such as Verizon and T-Mobile have spectrum that covers large swaths of the United States. In many rural areas that spectrum is not being used. “All the capacity that you do not use at this current time is lost forever,” said Recon Analytics analyst Roger Entner in an interview last year. “If they have excess capacity, they can fill it, they can make money off it. Telecom in wireless is a high fixed-cost, low variable-cost business. Once the equipment is in the ground or on the antenna, it’s pretty cheap to offer services.”
RELATED: Verizon’s LTE fixed wireless access is now available in 48 states
Currently, Verizon offers its fixed wireless LTE Home in parts of 48 states; and it offers 5G Home in 28 markets. Verizon anticipates passing 15 million homes with some version of its fixed wireless access product by the end of this year.
Verizon’s EVP and CEO of its consumer group Ronan Dunne recently spoke at a FierceWireless virtual event.
On the capacity question, Dunne said that in dense urban areas Verizon will bring together its mmWave and C-band spectrum "to significantly enhance the capacity that’s available for residential broadband."
RELATED: Verizon may densify its network for C-band in the mid-term, says Ronan Dunne
Verizon has set big goals.
“We see the opportunity, as we’re fully rolled out, of having the largest addressable market in residential broadband in the U.S.,” said Dunne. “So we talk about 50 million homes by 2025 with fixed wireless access."
And Dunne, like Malady, takes into account Verizon’s fiber assets as well as its FWA technology as part of the company’s overall home broadband ambitions.
“I already have access to about 17.9 million homes passed in the Fios footprint,” said Dunne. He adds together the 17.9 million Fios homes and the 50 million FWA homes to point out that by 2025 Verizon will pass about 67.9 million homes with residential broadband.
Speaking at the Cowen event, Malady said Verizon’s One Fiber program is in the “6th or 7th inning” now connecting shorter distances (metro fiber, laterals), and not long distances, and should wind down around 2024.
Meanwhile, others are picking up the fiber-to-the-home baton.
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Lumen’s CEO Jeff Storey said this week that the company’s Quantum Fiber FTTH product is superior to wireless or hybrid fiber coax (HFC) connections for small businesses. He touted fiber’s symmetrical upstream and downstream capabilities, compared to other types of connectivity.