Why Fixed Wireless is a Big Deal for Verizon, AT&T

Fixed wireless is a bigger deal for Verizon than it is for AT&T; while fixed wireless holds more promise for AT&T than for many other mobile operators globally. The reason is partly regulatory in nature. No U.S. fixed network telecom service provider (including cable TV companies) ever has been allowed to reach more than about a third of all U.S. homes.

Verizon’s fixed network reaches far fewer than that. Assume there are about 118.3 million U.S. homes. Assume Verizon passes about 23 million of those locations (after the sale of about 3.7 million voice connections, 2.2 million high-speed data customers and 1.2 million video customers. or about 19 percent of U.S. homes.

AT&T, in contrast, passes about 62 million U.S. homes, or roughly 52 percent of U.S. homes.

If Verizon does not compete to sell fixed network services to about 80 percent of U.S. homes, then fixed wireless supplied by the mobile network could allow Verizon to compete for customers representing more than 80 percent of all U.S. homes, for the first time.

Mobile network market concentration is not typically measured by “passings,” as are fixed networks, nor by potential customers, but by “accounts served.” So there is no immediate restriction on Verizon’s ability to use its ubiquitous mobile network to provide service to U.S. homes outside its traditional fixed network footprint.

“We could be a significant player for delivering broadband and video over-the-top, over that exact same network, and it's almost I mean incrementally and the cost is miniscule to be able to address a very large market outside of the Washington and the Boston corridors,” said Lowell McAdam, Verizon CEO. “You are then a broadband provider and a TV provider outside of your franchise footprint.”

That is a big reason Verizon is so big on fixed wireless enabled by 5G. " We did not need to wait for all of the mobile standards, we didn't have to wait for it to be...crammed into an iPhone or a Samsung Galaxy device,” said McAdam. “You can use basically your home router that you have today, just put some different chips in it, and we're working with Intel on that, and you are then a broadband provider and a TV provider outside of your franchise footprint.”

But fixed wireless also will have the same attraction for AT&T, which operates a fixed network reaching about 52 percent of U.S. homes. In much the same way, the DirecTV acquisition now allows AT&T to sell linear video to nearly 100 percent of U.S. homes.