Verizon Preps Fixed 5G but Mobile Gigabit-Speed Downloads May Not Arrive Until 2019

Dan Jones
News Analysis
Dan Jones, Mobile Editor
4/24/2018



Verizon said Tuesday morning that it has started deploying commercial nodes to support the launch of its fixed broadband 5G network in three or more US markets, in the back half of 2018.

Verizon Communications Inc. (NYSE: VZ) has promised to initially deliver a fixed wireless 5G service that provides gigabit downloads over the air -- using high-band millimeter wave spectrum -- in the second half of this year. The operator is using its 5GTF specification to try and beat competitors waiting for standard 5G products based on the 3rd Generation Partnership Project (3GPP) New Radio (NR) standard, which are anticipated in 2019.

"We are quickly approaching the launch date of our residential broadband service" Verizon CFO Matt Ellis said on the operator's first-quarter earnings call Tuesday morning of Verizon's initial 5G foray.

"We continue to be very excited about the opportunities that 5G has," Ellis said.

The CFO said that the pre-commercial trials are now done. He stated that Verizon had shown propagation "over 2,000 feet," for the 28GHz millimeter wave (mmWave) technology it will use for fixed wireless initially, and mobile services eventually. (See Millimeter Wave 5G: The Usain Bolt of Wireless?.)

Sacramento is the only 5G market that Verizon has named so far. Ellis says that the other markets will be named closer to the launch. He notes, however, that 5G "commercial nodes" are being deployed in these initial unnamed cities now. (See Is Atlanta the Next 5G Market for Verizon?.)

Verizon expects to support mobility with its network when the NR specification products are available. "It's a mixed-use asset," Ellis said.

Chris Schmidt, Verizon's executive director of device technology, told Light Reading in February, that Verizon will be able to reuse the same towers and "generally" the same infrastructure from its fixed wireless deployments, which use its own 5GTF specification for the 5G NR services. "Obviously, there's going to be some infrastructure changes that need to happen," Schmidt said at the time. (See Verizon: We'll Be First With Fixed & Mobile 5G.)

Exactly when 5G NR-compatible devices, however, still appears to be somewhat up in the air. "We expect to be getting the CPE [customer premises equipment], based on the NR standard, probably next year," Ellis said on the call.

Ellis was questioned on the call about whether 5G will expand Verizon's 5G spending for the year. Ellis stressed again that the rollout is factored into the $17 billion to $17.8 billion spending for the year.

"I don't see us having a massive acceleration in capex," Ellis said. "This is not the same thing as when we adopted 4G and went from CDMA to LTE ... This is a very different rollout."

Ellis was also guarded about the expected forthcoming millimeter wave auction from the FCC. "We will certainly take a look at any auction that comes up," Ellis said. (See Trump Bill Paves Way for US 5G Spectrum Auction Later in 2018.)

He stressed, however, that Verizon believes it has the spectrum assets to get its 5G mobility deployment underway -- without additional mmWave or lower-band spectrum.

The 5G mobile rollout will be "very much heavily focused on urban areas," initially, Ellis said.

For the first quarter, Verizon reported revenue of $31.8 billion, up 6.6% year-on-year. First-quarter net income was boosted by tax reform, and rose 32% to $4.55 billion, compared to $3.45 billion last year. earnings per share were $1.11, compared to $0.85 last year.

Verizon shares are trading up $1.09 (2.24%) to $49.75 on Tuesday morning on the earnings report.

— Dan Jones, Mobile Editor, Light Reading

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