Verizon and AT&T’s contrasting strategies were on display this week during their respective earnings reports, and not just for how they are deploying 5G . Aside of their respective announcements on nationwide deployments of 5G, the two telcos are also battling for the hearts, minds and wallets of residential broadband subscribers.
On Friday, Verizon said on its second quarter earnings call that it plans to have its 5G Home fixed wireless access (FWA) service available in 10 cities this year. Verizon currently has six 5G Home cities—Los Angeles, Houston, Detroit, Chicago, Indianapolis and Sacramento—but it hasn’t announced the additional four cities its targeting in 2020.
As far as upload and download speeds, for example, in Detroit, the new 5G Home service comes with the latest Wi-Fi 6 router with typical download speeds of around 300 Mbps and, depending on location, peak speeds of up to 1 Gbps.
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During AT&T’s Thursday earnings call, AT&T CEO John Stankey was asked if his company would use 5G in addition to fiber-to-the-home for its gigabit broadband service. Without mentioning Verizon by name, Stankey said he didn’t see using 5G for a home broadband service. Stankey said he had an “appetite for fiber” deployments across the consumer space, 5G and its business segment.
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“We have lines of business in all those areas and that should give us leverage in fiber deployments that I think others—that are either only a fixed line provider and reselling wireless services, or those that are only wireless providers trying to deploy more fiber intensive 5G networks—don’t enjoy,” Stankey said. “I personally do not believe that 5G is a replacement in the near term for suburban residential single family living units. As an optimal strategy, I think it’s going to be a tough one to beat when there is embedded gigabit-capable fixed line networks in place.
“I think there is clearly going to be stuff on the margin that makes sense around that, but I don’t believe in the near term that 5G is the right fixed line replacement strategy in what I would call the typical single family home infrastructure.”
So of course Verizon CEO Hans Vestberg was asked “One of your competitors was talking about 5G as a home broadband replacement not really being such a great replacement,” during Verizon’s earnings call on Friday. Vestberg said the comments on Verizon’s 5G Home service were “from people that are not really doing it, of course, I cannot even comment on that.” Vestberg said Verizon would enter those 10 cities “with a much better chipset.”
“We feel really good about our model,” Vestberg said. “As we have said before, a minimum of 10 5G Home cities (this year). That’s our plan for this second half. So, again, we feel good about our learnings. (We) are deep on building coverage, throughputs and all of that.”
Vestberg said he was excited about the self-install model that is part of the 5G Home service. Customers will receive the customer premise equipment and “be able to install it themselves in a short time frame.”
“I wanted to be below one hour, but we have come a far way from the eight hours we started with,” Vestberg said of the self-installs for the Home service. “And compared to a fiber installation—where you need to first put it on the agenda, wait for a couple of weeks and you have to come there and install it and it takes hours to do—this is a totally different way. It’s transformative.”
As Verizon and AT&T conduct their large-scale 5G battle across the nation, the turf war between Verizon’s 5G Home service and AT&T’s fiber-based gigabit service will play out across subscribers’ homes over the coming years. While Stankey likes AT&T’s chances with fiber, he’s not opposed to using 5G in the future if it becomes necessary.
“Look, if it ultimately moves that way and we start to see the technology stabilizing, we’re as well positioned as anybody to pivot to that,” he said. “We’ve certainly got the spectrum and the assets to make that happen, but I’m just not of the mindset right now that that’s the optimal place to win in the market.”
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