Consumer Mobility Will Drive Verizon Results, not IoT, Edge Computing or Private Networks

Service provider financial outcomes generally are affected by trends in their core businesses, not the development projects such as internet of things, private networks or edge computing.

In 2022 Verizon earned nearly $137 billion in revenue, of which more than $74 billion came from mobility services. So mobility generated 54 percent of Verizon revenue. Looking at consumer revenue from both fixed and mobility networks, that segment contributed nearly $104 billion in revenue, or about 76 percent of total. 

Business revenue added about $31 billion, or nearly 23 percent of total. 

source: Verizon

 

source: Librarian Capital 

So it is obvious that overall Verizon financial performance is shaped most directly by consumer mobility services. A one-percent change in gross revenues for consumer mobility would move the needle. 

A one-percent change in edge computing, internet of things or 5G private networks likely would not show up in reported financials. Verizon does not separately report those items, but observers doubt that Verizon or At&T earn much more than low single-digit billions from all those sources (IoT, edge computing, 5G private networks) put together. 

In fact, those revenue items are likely buried within either the consumer mobility or business wireless segments

The point is that, as important as the newer initiatives might be, as ways of generating a sense of movement towards products of the future, none of the initiatives, with one exception, have a material impact on current revenues. That exception is fixed wireless. 

In 2022, for example, fixed wireless contributed noteworthy numbers of access lines, adding 776,000 net lines in 2022, for example. 

Private networks and private networks should develop into revenue streams eventually worth $1 billion each. Internet of things connections should be more important than that. But none will soon rival the impact changes in the core consumer mobility business will have. 

In principle, business services could have some impact, but that segment tends to contribute just a little less every year than it did the year before, so the anticipated change is not so great.

Consumer mobility drives 76 percent of total revenue and perhaps a higher percentage of profits. New product initiatives are important, if for public perception, if nothing else. But none of the new products--save possibly fixed wireless--will materially affect Verizon financial outcomes.