Verizon needs to spend on small cells and network densification to support VoLTE and multicast video, according to its CFO.
Verizon Communications Inc. (NYSE: VZ)'s Fran Shammo called out the small cell, distributed antenna and in-building work at a recent Oppenheimer & Co. Inc. conference. Verizon has posted a webcast of the comments.
"You need that densification in the LTE network," Shammo said. "That's really where most of our investment will go this year."
Despite the anticipated cost benefits of software-defined networking (SDN) over the coming years, Shammo isn't expecting Verizon's capex to decline; in fact, he expects wireless capex to increase over the next couple of years.
"The reason our capex will not decline is because in wireless you have to build out these small cells, these antenna systems and in-building coverage if you want to stay ahead of the capacity and give the customer the experience that they want," Shammo said. "If you think about voice-over-LTE, that densification has to be pretty strong if you want to hold that high-quality call throughout your network."
"The handoff of VoLTE is a little different than CDMA was, and it has to be a much more densified network in order for that to work appropriately," Shammo elucidated.
Verizon is expecting to launch VoLTE at the tail end of this year. (See Apple Eyes VoLTE as 4G Voice Gets Real.)
Multicast is "about a year out," Shammo says. (See Verizon's Multicast LTE Video to Arrive in 2015.)
— Dan Jones, Mobile Editor, Light Reading