Few, if any, decisions made by connectivity providers are the result of anything other than clear understanding of the business implications of choices. That is clear in Verizon’s decision to use its 4G network for rural internet access.
Verizon is launching 4G-based “LTE Home Internet” service in Savannah, Ga.; Springfield, Mo. and the Tri Cities, area of Tennessee, Virginia and Kentucky. Beginning July 30, Verizon says it will expand such 4G-based home Internet access to customers outside the Fios and 5G footprints.
The thinking is driven by the business case. Fiber to the home is not viable for Verizon (with its embedded cost structure) in rural areas, even if adjacent to Verizon markets with Fios. Neither is 5G fixed wireless, at the moment. And with Verizon in the early stages of shifting mobile customers to 5G, more capacity will be freed up on the 4G network.
At this point, the LTE home internet offer is designed to leverage Verizon’s mobile customer base, and to compete for value accounts. The offer also is priced at about the U.S. average monthly cost between $50 and $65 a month, for standalone plans. Prices for internet access purchased as part of a bundle sometimes are lower, though one has to attribute prices in such cases.
LTE Home Internet costs $40 a month for Verizon mobile customers and $60 a month for non-Verizon mobile customers, and provides unlimited usage. That is a key feature, as the fixed network plans Verizon competes with feature very-large usage allowances.
The LTE Home router costs $240, and can be purchased on an installment plan for $10 a month. Speeds are set at a minimum of 25 Mbps with peak rates of 50 Mbps.
The clear business case advantage for Verizon is that it is able to leverage its 4G network and resources, reducing stranded assets and boosting profits over any other approach that would require building a separate network.
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