Realme 5G down to $145 ** 80M 5G subscribers in Q2, 100M August prove 5G is real.** 5G Worldwide: Saudi first, USA last** 5G Phones $199-260
China is > 70% of 5G as subs pass 80M ** Primary: Cost per bit of wireless is falling at a ferocious rate
5X Advance for Africa with Massive MIMO ** Spectrum Marvell: 5 nm 20-40% better ** $400 TCL REVLL 5G at T-Mobile: Here comes 5G in the USA
$Hundreds of millions in extra chip costs prove Open-RAN not quite ready
Dropping 10M wired homes, 50-75% of territory. Please don't shoot the messenger - I still support DSL. CEO Lowell McAdam intends to shut most copper served homes, 10-15M. This is not because those homes aren't profitable, but they will be even more profitable if served by Verizon's LTE.
Here's what Lowell told the CITIBANK conference.
"We're moving a lot off of copper onto wireless, as well, especially for voice services and lower speed DSL. And that allows us to have the maintenance savings and gives the customers frankly better service than they would on antiquated copper. So we're doing a number of things to sort of prune the assets down and be a bit more focused."
This is not news to the industry, which has known for at least two years that AT&T/Verizon intend to strip about half of the U.S. territory of landlines. Washington and most states have put their heads in the sand. The two companies control more than half the U.S.. The FCC continues to plan rural broadband coverage on the assumption they they build. Verizon and AT&T have no intention of expanding to the unserved rural areas even if the government gave them large subsidies.
Both companies offer LTE to 95+% of the U.S. population and both telling D.C. they will go to 97-99%. Verizon CTO Dick Lynch in 2009 explained at the big Barcelona conference their customers demanded nearly complete coverage. He said then VZ would bring LTE to 97-99% of the population. That's even more important today as they hope to sell car connections, which need to work outside of cities. Both companies have massive unused spectrum in rural areas, allowing them to add rural wireless customers at minimal marginal cost.
That still leaves much of the territory (?10-20%, 1-3% population) without wireless or wires. Their LTE solution for about half the territory costs twice as much as the wires they want to abandon. If much of the country is going wireless-only, then we need universal service requirements for wireless.
Some more from McAdam at Citibank that's interesting.
"When we went from 3G to 4G, our efficiency of the network went up by 8 times." Verizon is reducing investment in 3G to almost nothing but still has extra capacity on 3G. Customers are switching to 4G very rapidly; 75% of the traffic is on 4G. India and Africa plan to continue investing in 3G, which I believe is a mistake. 4G carries much more per MHz and with higher MIMO that gap will only increase. 4G phones are down to $125 already and headed to $80. The primary chips are down to less than $10 from both Qualcomm and MediaTek. The gap between 3G and 4G phone costs will appproach zero in 12-36 months.
In the same presentation, McAdam pointed to Verizon's plan to support a bill for Net Neutrality - with a limited definition likely to gut the legislation.
I think the bright spot here is that the Hill is now starting to circulate some potential legislation. We are not privy to all of the details of it but from what I have heard it is very simple, no throttling, no preferred access to websites, keeping what net neutrality is really meant to be pure and not allowing advocates for a certain financial model to take over the dialogue here. So I'm hopeful that the legislation will become law and we will see some compromise and move this forward because frankly the lack of certainty around this will impact capital deployment in the future and I don't think that the economy can stand that.
Sources: The coverage map above is from Verizon. The 10-20% estimate that they do not want to offer either wired or wireless corresponds roughly to the white areas on the map with no LTE. Verizon and AT&T have carefully not revealed whose service they want to cut. They are trying to get the end of universal service by stealth.
The second map is problem reports per deadcellzones.com. The red is where they have the most problem reports. This overlaps many of the areas that Verizon claims are served. The company maps and coverage claims cannot be verified and often are in error.