Inside T-Mobile's New 'Home Internet' Business
T-Mobile has made no secret of its plans to test a fixed wireless Internet service this year with up to 50,000 households. The operator announced earlier this year it would offer $50/month broadband services with no usage cap and speeds of "around" 50Mbit/s to homes and offices in unspecified "rural and underserved" areas of the country.
But here's a taste of what T-Mobile is actually providing: Outside of Memphis, Tennessee, one of the customers who is using the service says he is getting, on average, 80Mbit/s to 130Mbit/s download speeds and upload speeds of 40Mbit/s to 45Mbit/s. His ping times, as recorded by the SpeedTest network-testing service, are roughly 75-80 ms on average.
"We've been really pleased with it so far," the customer, Taylor, wrote in response to my questions. Taylor agreed to speak with me about the service, but asked that I not use his full name. "There are a few pain points, but overall it's been exceptional. I know this is a new venture for them so I'm sure things will be improving rapidly over the next year or so."
Others have offered similar comments: "I love T-Mobile home Internet! Iíve had it for almost a month and Iíve enjoyed every minute," wrote one user in a review of the operator's installation app. "No slowness, no interruptions, no problems at all. Iíve always wanted Internet in home but couldnít afford it and along came T-Mobile! I'm glad I took advantage of their invitation to try it, thumbs up for me!"
But not everyone agrees: "I know this is new and is a great concept but they do not have the kinks worked out yet," another reviewer wrote. "The Internet said I had excellent signal strength and I would lose my Internet connection and could not reconnect. The app worked great. I gave it one star for the Internet service."
Pros and cons of T-Mobile's Home Internet
Taylor signed up for T-Mobile's Home Internet service around three months ago after receiving a message in the mail that the service was available in his area.
"When we got the home Internet [from T-Mobile] three months ago, we lived in a nearby neighborhood that had both Comcast and AT&T Uverse. At the time, we had Comcast Internet. Both of these two services were more expensive for slower speeds," he wrote. "So we switched to T-Mobile."
Continued Taylor: "Last month we moved down the street to a new neighborhood that was being developed. There's currently zero infrastructure yet for cable/fiber (still!). All we had to do was plug in our home Internet router and we were back in business DAY ONE. No waiting for months for cabling to be brought to out neighborhood. No calling to make an appointment for service. No taking off from work and waiting around the house hoping they show up. Within the first hour of moving into the house, we had full-blown Internet and were able to watch TV. That process is a game changer."
Taylor, who also subscribes to T-Mobile's mobile smartphone services, said he and his wife use YouTubeTV, Netflix and HBOGo and consume an average of around 100 to 150 GB per month on their home Internet service. He said T-Mobile's Home Internet service supports almost all of his Internet needs -- except for gaming. "For instance, I play [online video game] Rocket League," he wrote. "And the ping times to those servers is usually between 100-125ms. When i was on Comcast, my speeds were typically less than 50ms. That's the last real draw to cable/fiber IMO."
The "ping" to a server is the amount of time it takes for a computer to answer a users' Internet request, and is often called latency. LTE networks often provide latency speeds of 50-100 ms, though newer technologies like 5G and edge computing promise to lower those speeds to 10 ms or less. Latency on today's fiber or cable networks are often in the range of 30 ms or less. However, a wide variety of factors can affect latency speeds, including the access technologies being used (like WiFi or LTE) and the routing, or path, a network operator applies to the request.
Indeed, here's what Taylor told me about the situation: "I'm HOPING that with 5G... latency speeds will fix this issue. Another thought/hunch is that because TMobile has not typically been needed for low latency gaming, they haven't worked much in trying to figure out the best routing for gaming servers/farms in different parts of the country. Maybe???" Taylor wrote. (My response: Have you considered writing for Light Reading?)
Latency isn't the only hiccup with T-Mobile's new service: "T-Mobile Home Internet supports video streaming from multiple services, however live TV (e.g., live sports and live broadcasts) is not currently supported," the operator wrote on its website.
Also, T-Mobile said that its Home Internet customers will receive the same "network prioritization" as its "Heavy Data Users," which means that it may slow customers' speeds if they consume more than 50GB in a month, as it does with smartphone customers. But T-Mobile added that its Home Internet customers "should be less likely to experience congestion because the equipment is stationary and available in limited areas."
Internet from a toaster
Unlike some fixed wireless services that require professional technicians to install receivers on the outside of a customers' building, T-Mobile's Home Internet is delivered in the mail, and customers simply plug in the router to access service. (The router connects to a nearby T-Mobile tower via LTE for backhaul, and broadcasts a WiFi signal for in-home coverage.)
"The installation was as easy as plugging in a toaster," Taylor wrote. "One nice benefit, that we've already found useful is the included 5200mAh battery backup that's in the router. Our house lost power one night, and we still had our home Internet, so we could continue working on our phones/laptops. This was extremely helpful for someone like me that works from home and needs reliable Internet."
This probably means T-Mobile is only offering the service only to customers who live relatively close its towers, given the need for the carrier's LTE signal to penetrate inside a building. The operator has said it will use its existing cell sites to offer Home Internet service, rather than building new sites.
But that doesn't mean the service is portable: "T-Mobile Home Internet LTE Wi-Fi Gateway will be geographically locked to your specified home's location so you won't be able to move it from one home to another," the operator wrote on its website.
T-Mobile isn't the only operator looking to cut out installation costs from a fixed wireless offering. For example, Verizon launched its 5G Home service with professional, "white glove" installations last year, but plans to mostly focus on indoor receivers that customers install themselves when it relaunches the service later this year. Others are hoping to do the same.
Finally, it's also worth pointing out that T-Mobile's Home Internet service doesn't work with the operator's new TVision live TV service. "We are always working to provide the best customer experience and will let you know as soon as these products work together," the operator wrote on its website.
A decidedly rural focus
So is T-Mobile's Home Internet service a direct challenge to the nation's existing, wired Internet providers? Should AT&T and Comcast start worrying?
A brief perusal of T-Mobile's signup page for Home Internet shows that it is targeted squarely at users in rural areas (customers can check for coverage by inputting their zip code). Indeed, according to several "learn more" videos on the operator's website that feature sunsets, green fields, wooden fences, church steeples, "local residents" and other Norman Rockwell-type scenery, the service is only available to customers who like "clean air, fresh eggs and wide open spaces." (And If you're wondering exactly where these "local" residents live, the nationwide coverage maps in the videos include the barely visible caveat: "Does not depict coverage.") A spokesperson for the operator did not answer questions from Light Reading about where the service is available.
This all doesn't mean that T-Mobile's Home Internet will stay rural. The operator has said that, if it is successful in merging with Sprint, it will use 5G to offer in-home broadband Internet services to almost 10 million households by 2024, covering 52% of all US zip codes.
T-Mobile executive Dave Mayo had been in charge of the operator's fixed wireless operations until he left the operator earlier this year. Gerry Lawlor, VP of T-Mobile Broadband Services, is namechecked in the operator's Home Internet videos.
Some Wall Street analysts remain decidedly skeptical that fixed wireless offerings like T-Mobile's Home Internet and Verizon's 5G Home will impact the nation's existing wired Internet providers like Comcast and Charter. "The impact of T-Mobile capturing home broadband share is immaterial to fixed broadband companies generally, and cable companies in particular," the analysts at New Street Research wrote in a recent report.
That may be true in large parts of the country. But for customers like Taylor, fixed wireless is clearly a viable option considering he decided to leave Comcast for it.
And that's particularly noteworthy considering T-Mobile Home Internet works today over 4G. In the coming years, 5G could sway the fixed wireless calculation much, much further.