During an investor event held at the exact minute the FCC's quiet period ended for its C-band spectrum auction, Verizon outlined exactly how it plans to expand and extend its 5G network with its C-band holdings – and how it expects to profit from the endeavor.
Verizon said it expects to offer up to 1Gbit/s peak speeds to 250 million Americans by 2024 by spending an extra $10 billion on its network over the course of those three years. However, the operator confirmed that it will not levy an extra charge for access to its speedy 5G network; instead, the operator will continue to position 5G access alongside other goodies like a Disney+ subscription in its more expensive "premium unlimited" rate plans.
Verizon added that the network upgrade will allow it to offer in-home broadband services to up to 50 million households by 2024, or around 41% of the entire US. That's a significant increase over Verizon's earlier promises of eventually reaching 30 million households with its fixed wireless Internet service. It also represents a significant expansion of the company's battle with the nation's cable Internet providers.
Verizon executives said the operator's fixed wireless Internet services will be priced "competitively," and that Verizon's network will have the capacity to handle millions of customers' home Internet traffic. That's noteworthy considering the average smartphone user consumes around 12GB of data per month, according to Ericsson, while OpenVault estimates the average household consumes around 500GB of data per month.
"We feel really good about the capacity," said Verizon CEO Hans Vestberg.
Cable companies "will probably have more capacity challenges than I will," said Verizon's Ronan Dunne. Dunne added that Verizon expects to attract up to 20% or more of home Internet customers in markets where it launches its fixed wireless Internet service.
Taken together, Verizon expects its 5G efforts to help grow its overall corporate revenues by 4% or more by 2024, up from the 2% growth it expects this year. The operator added that it will continue to pay out dividends to its shareholders during that period.
"When we launched 4G, the market could not see what was coming around the corner. Or that in a matter of years, stepping out from the curb and hailing a cab would become obsolete," explained Verizon's Vestberg in a nod to companies like Uber and Lyft, which developed their services for 4G connections. "We're about to turn that corner again. And there will be the next generation of unicorns ready to innovate on what we are building. That's not a prediction; it's a promise."
Here's the timeline of Verizon's 5G upgrade plans:
End of 2021
Perhaps more importantly, Verizon CTO Kyle Malady said the operator does not plan to add more cell sites to its network and will instead use its existing cell tower grid, which he said is already dense enough to handle a C-band network. That's noteworthy considering T-Mobile has questioned the ability of its rivals to build out extensive C-band coverage due to the relatively diminutive propagation characteristic of signals in the C-band spectrum.
2024 and beyond
- T-Mobile puts premium price on 5G perks
- C-band auction maps and charts: Who won what, where and how much
- 'Power users' consuming 1 TB+ per month have almost doubled – OpenVault