Light Reading

Verizon LTE Plan Not a Rural Slam-Dunk

Carol Wilson
6/18/2010
50%
50%

Leaders of two rural telecom associations are cautiously optimistic about Verizon Wireless 's plan to partner with rural network operators to build out its 4G long-term evolution network in rural areas.

Kevin McGuire, vice president of business and technology for the NTCA - The Rural Broadband Association , and Stephen Berry, CEO and executive director of the Rural Cellular Association , think it's generally good news when a major telecom service provider talks about building broadband facilities in rural areas.

But McGuire, who has spoken with Verizon officials on this topic, warns that it is early days for these discussions, and Berry, who will be speaking with Verizon, remains concerned that Verizon's approach to building out LTE will still leave his members unable to use the 700MHz spectrum for which they paid millions.

Verizon said, as part of its plan to duplicate its 3G footprint with a 4G mobile broadband network, that it "plans to work with rural companies to collaboratively build and operate a 4G network in those areas using the tower and backhaul assets of the rural company and Verizon Wireless’s core LTE equipment and 700MHz spectrum."

Multiple Verizon spokespeople declined to comment further on what exactly Verizon plans to do. (See Verizon Says LTE Will Match 3G Footprint in 2013.)

The glass-half-full thinking on this for Berry is that Verizon is planning a rural buildout.

"It's good that they are talking about it, because before, as recently as a couple of weeks ago, Verizon said they had no plans to build out in rural America," Berry says. Conversations with some of the RCA's members may have sparked the change, he says.

But Verizon's plan for building out its 700MHz spectrum specifically excludes interoperability with the portion of the 700MHz spectrum purchased by rural carriers, Berry notes, and that leaves rural carriers out in the cold in terms of getting equipment manufacturers and, more specifically, handset manufacturers to build equipment for the rural markets, given the lack of economies of scale.

RCA members who purchased 700MHz spectrum paid more per PoP than Verizon or AT&T Inc. (NYSE: T) did, although that pair paid much more in absolute dollars to get national licenses, Berry argues.

"Our guys would have to buy 450,000 to 500,000 handsets to get scale, and that's not possible," he says. Without that, high-end handsets for use on rural networks could cost $1000 or more, which isn't competitive with what AT&T or Verizon would offer.

The glass-half-empty view of what Verizon is doing is that the carrier is playing "stall ball," Berry says, trying to convince the Federal Communications Commission (FCC) that it's actively building out a rural network in a cooperative way to forestall the likelihood that the FCC will mandate data service roaming in the same way it previously mandated voice service roaming.

McGuire's members are not generally in the wireless business -- many of them tried but were driven out by the difficult economics of competing with national players that have economies of scale in their favor, and for them, a Verizon partnership has more upside.

"Because it is very much in its infancy, in its formative stages, I'd have to say it depends on what the final agreement looks like," he says. "If it is going to be a win-win -- if you look at dollars and investment necessary for them, it meets their network expansion desires and the dollar savings and, for us, allows us to serve our customers and creates a lucrative business case -- then yes it's a good thing. Our concern is whether it manifests in this way."

McGuire says he expects many of his members that also offer wireless services and have acquired 700MHz spectrum to use it to offer fixed wireless services, delivering broadband to places where fiber or copper facilities aren't economically or technically feasible.

— Carol Wilson, Chief Editor, Events, Light Reading

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Flash Poll
From The Founder
Network architects aiming to upgrade their networks to support agile, open, virtualized services in the 21st century need to consider new criteria when choosing between technology suppliers.
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
Between the CEOs
HP's Prodip Sen: The NFV Journey

7|7|15   |   21:39   |   (0) comments


Prodip Sen, CTO of the Network Functions Virtualization (NFV) business unit at HP, talks to Light Reading founder and CEO Steve Saunders about the four stages of the NFV journey.
LRTV Documentaries
PSA: The Perils of a Hyper-Connected Society

7|6|15   |   1:38   |   (0) comments


A public service announcement calling attention to the perils of a hyper-connected society.
LRTV Interviews
Guavus Takes Analytics on the Road

7|6|15   |   4:09   |   (1) comment


Guavus CEO Anukool Lakhina tells Light Reading CEO and founder Steve Saunders how the analytics tools developed for telcos are applicable to the transportation industry.
Telecom Innovators Video Showcase
Mellanox's New 25/50/100Gb/s Ethernet Products

7|6|15   |   2:44   |   (0) comments


Mellanox offers a complete 10/25/40/50/56/100Gbit/s solution that delivers industry-leading performance, scalability, reliability and efficiency for optimal application performance and data center ROI.
Telecom Innovators Video Showcase
Arista's CloudVision

7|6|15   |   6:01   |   (0) comments


Anshul Sadana answers questions from Steve Saunders, Light Reading’s founder and CEO, about Arista’s CloudVision, a global cloud network controller for workload orchestration and workflow automation delivering a turnkey solution for cloud networking.
LRTV Custom TV
Red Hat Demo

7|2|15   |   10:53   |   (0) comments


Red Hat's Nicolas Lemieux demonstrates how Red Hat is driving innovation through open source communities.
LRTV Custom TV
Red Hat's Approach to OpenStack Adoption

7|2|15   |   5:17   |   (0) comments


Red Hat's Radhesh Balakrishnan outlines his company's open source strategy for both enterprises and telcos.
LRTV Custom TV
The New IP Goes Mobile With vEPC

7|2|15   |   1:12   |   (0) comments


Heavy Reading's Gabriel Brown discusses results of a Light Reading survey sponsored by Brocade that shows a clear commitment by mobile operators to move quickly to virtual EPC deployment.
LRTV Custom TV
Making Business Sense of SDN

7|2|15   |   1:42   |   (0) comments


Results of a Brocade-sponsored survey show that CSPs have a clear sense of SDN use cases but are wrestling with the business case. Sterling Perrin of Heavy Reading looks behind the numbers.
LRTV Custom TV
NFV Will Be Here Sooner Than You Think

7|2|15   |   2:22   |   (0) comments


Forget the usual ten-year cycle for new technologies – NFV will be a core part of CSP networks in five years, based on results of a Brocade-sponsored survey, says Heavy Reading's Caroline Chappell.
LRTV Custom TV
The New IP Gains Traction With CSPs

7|2|15   |   1:42   |   (0) comments


Roz Roseboro of Heavy Reading analyzes results of a Light Reading survey sponsored by Brocade showing that CSPs are getting serious about making the transition to the New IP era.
LRTV Custom TV
It's (Real) Time for Analytics

7|2|15   |   1:42   |   (0) comments


Heavy Reading's Jim Hodges looks at how CSPs say they plan to use analytics to deploy new services in real time as part of The New IP, based on results of a survey sponsored by Brocade.
Upcoming Live Events
September 16-17, 2015, The Westin Galleria Dallas, Dallas, TX
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
October 6, 2015, The Westin Peachtree Plaza, Atlanta, GA
October 6, 2015, Westin Peachtree Plaza, Atlanta, GA
October 14-15, 2015, New Orleans Ernest N. Morial Convention Center, New Orleans, LA
November 5, 2015, Hilton Santa Clara, Santa Clara, CA
All Upcoming Live Events
Infographics
Equinix walks through the past four digital economy eras from computing to network to connected to today's interconneted world.
Hot Topics
What's a Gigabit Good For?
Carol Wilson, Editor-at-large, 7/1/2015
Colt to Jettison Ailing IT Business
Iain Morris, News Editor, 6/30/2015
Eurobites: Activist Investor Takes Stake in AlcaLu
Paul Rainford, Assistant Editor, Europe, 6/30/2015
FCC Chairman Talks Up SDN/NFV
Mari Silbey, Senior Editor, Cable/Video, 7/2/2015
A&E Launches Lifetime OTT Service
Alan Breznick, Cable/Video Practice Leader, 7/3/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Prodip Sen, CTO of the Network Functions Virtualization (NFV) business unit at HP, talks to Light Reading founder and CEO Steve Saunders about the four stages of the NFV journey.
Casa Systems has been going from strength to strength over the last couple of years. In 2013, it became the first vendor to ship an integrated CCAP device -- the ...
Cats with Phones