The fixed wireless access (FWA) market is in the early innings, but a new study shows that the availability of T-Mobile's offering has a clear lead over Verizon's.

T-Mobile's FWA product is available to about 39% of total US households compared to just 15% for Verizon's, Evercore ISI found in a study that covered a random sample of 10,000 residential addresses across the country. The addresses were proportionately sampled by state to ensure a representative sample across the US and, thus, to avoid any regional skew, the firm noted in a study that was distributed via email to registered users.

Availability for both has risen since Evercore ISI performed a similar analysis on the same dataset in September 2021 as T-Mobile expanded its "Ultra Capacity" (midband) 5G and Verizon started to activate C-band spectrum last month. T-Mobile's coverage has climbed modestly – from 35% to 39% of households – during that span. Verizon's 5G FWA service has increased from just 2% of US households last fall to about 6% in ISI Evercore's latest study.

Those reach numbers are, of course, going to be changing from week to week and from month to month. Coming off its FWA-touting Super Bowl ad with Jim Carrey reprising his role as "The Cable Guy" and its recent activation of C-band spectrum, Verizon announced Monday that the reach of its wireless Internet service has expanded to cover more than 30 million US homes and north of 2 million businesses; an increase of about 10 million since last month.

T-Mobile's cautious approach

Though T-Mobile's FWA product is available to a broader set of US homes, ISI Evercore's study found that over 25% are listed as being in areas where service slots are limited. In those instances, T-Mobile tells prospective FWA subs that "5G home Internet is available at your address – but spots are limited!," the report notes.

That's a clear indication that T-Mobile is "being cautious about service availably, adjusting it to ensure that home Internet doesn't crowd out the much-more-lucrative mobile offering," Vijay Jayant, analyst with Evercore ISI, explained. Amplifying that point, Jayant notes that T-Mobile's FWA home broadband is less appealing from a price per gigabyte perspective than its mobile service. MoffettNathanson made a similar observation in its recent analysis of the emerging FWA market.

Meanwhile, a large portion of Verizon's FWA product is still based on LTE and primarily targeted at rural customers with limited or no access to fixed broadband options. Of the 17% of US households outside Verizon's fixed footprint that are eligible for the company's FWA service, 63% are being offered an LTE-based service, the study points out.

Fiber and cable hold performance advantage

When viewing the market through a competitive lens, the study found that there's a small amount of overlap between the FWA offerings from both companies. According to the study, only 8% of the sample had both fixed wireless products available, and 40% had one of the products available. "The lack of overlap is primarily due to the relatively small footprint for both services, and particularly for Verizon's," Jayant noted.

As for performance, the study found a high variability of speeds among FWA services and a general feeling that the overall service quality of FWA lags behind broadband delivered via fiber and cable.

Overall, real-world fixed wireless speeds on 5G appear to deliver 100 Mbit/s or more in the downstream and about 20 Mbit/s upstream on a "relatively consistent basis," the study found. LTE offerings generated in the range of 10 Mbit/s to 50 Mbit/s down and 5 Mbit/s to 10 Mbit/s up. On the high end, some customers on Verizon's 5G millimeter wave (mmWave) service saw downloads at or above 1 Gbit/s and upload speeds in excess of 100 Mbit/s.

"There's limited data on uptime and reliability, but anecdotally, fixed wireless does appear to face more frequent downtime or dropouts than fiber or cable wireline broadband products," Jayant wrote.

Plenty of upside for FWA

Performance differences aside, Jayant does expect FWA to make a dent in the home broadband market, and build on a penetration that's estimated to be at 2 million US subs, accounting for roughly 2% of the share of total residential broadband customers. Those numbers will only increase as T-Mobile and Verizon continue to market their respective FWA products more aggressively.

FWA's biggest opportunity is no doubt in rural areas with little to no cable of fiber competition – ISI Evercore estimates there are about 1.5 million fixed wireless sub scribers in rural areas today where cable and fiber are not available. Jayant also expects FWA to get pick up in dense, urban areas where mmwave is competitive with cable, and also expects FWA to gather steam with value focused customers and those who are simply seeking an alternative to cable broadband.

"We expect fixed wireless will make up 45% of broadband net adds in 2022 and 50-55% thereafter," Jayant predicts. "We expect that in 2025 fixed wireless will have 7% share of total broadband subscribers, telcos will have 27% share, and cable will have 66%."

Related posts:

— Jeff Baumgartner, Senior Editor, Light Reading