Over the relatively near term, perhaps nine million to 23 million potential subscribers are candidates for wireless substitution where it comes to high speed Internet access, though that solution will not make sense for all consumers.
At an incremental $55 a month additional revenue, wireless substitution for Internet access could boost mobile operator service revenues between $6 billion and $15 billion, BTIG suggests.
The key variables at the moment are total monthly data usage per account, as well as current prices for fixed network Internet access, plus the usage of streaming video apps and services.
Median fixed network data usage of 23 GB means a sizable number of the 90 million broadband customers in the United States could have their usage needs addressed by wireless.
The “sweet spot” therefore includes fixed network Internet access accounts presently using between 20Gb and 30Gb per month.
In other words, the potential wireless substitution could range between 10 percent and 25 percent of the fixed high speed access market.
The wild card is that the market is not static. With additional spectrum, shared spectrum, 5G mobile networks and even higher use of Wi-Fi offload, offers are going to evolve, both fixed and mobile.
Even if cost-per-megabyte remains better for fixed access offers, the issue is how big a difference exists between offers (mobile versus fixed) and how well each offer matches a particular user’s requirements. That is a moving target, and prices vary with volume, especially in the mobile market.
With reasonable volume, mobile price per gigabyte hovers between $6 and $10. Fixed network prices are harder to characterize, since access is not sold “per gigabyte” and there often are not formal usage limits, making “cost per gigabyte” a statistical matter.
However, virtually all observers would likely agree that fixed network price per gigabyte is lower than mobile price per gigabyte.
FixFi
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