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Broadband services

Verizon Fios Sheds 52K Video Subs, Tacks On 34K Broadband Subs

As Verizon's priorities clearly center on 5G, its Fios wireline business continues to chug along. The results aren't terribly bad or outstandingly good. They're just sorta meh.

Driven by consumers' shifts to virtual MVPDs and OTT-delivered subscription VoD options, Verizon lost 52,000 Fios video subs in Q2, lowering that total to 4.34 million. Meanwhile, it added 34,000 Fios broadband subs, expanding that base to 6.15 million. Verizon lost 32,000 Fios digital voice subs, reducing that tally to 3.86 million.

Overall Fios revenues climbed 1.2%, to $3.01 billion, driven primarily by ongoing demand for broadband. Total Fios "digital connections" dropped to 14.22 million in Q2 2019, compared to 14.38 million a year earlier.

According to analysts at Nomura, Fios video losses were in-line with expectations while broadband net adds were a bit below expectations of 41,000.

5G Home update
Even as Fios continues to grow its broadband base, analysts continue to press for progress on 5G Home, Verizon's new in-home broadband service alternative that's powered by millimeter wave spectrum.

The initial rollout of 5G Home spans parts of four markets (Houston, Indianapolis, Los Angeles and Sacramento) as Verizon has capped market launches and software development as it develops a version of 5G Home consumer premises equipment based on the industry NR standard and moves further away from the initial use of Verizon's proprietary 5GTF transmission standard. Once Verizon launches that new-gen CPE, the company is expected to plow ahead with its 30 million-home buildout goal.

Verizon has not announced how many 5G Home customers it currently has, but "our win-share is really good in those markets," Verizon CEO Hans Vestberg said on Thursday's earnings call.

With respect to the rollout of the NR-based version of 5G Home, 2020 will be an "important year for us," he said, but warned that the fixed wireless broadband service won't have a "significant impact" on Verizon revenues until 2021.

Vestberg noted that Verizon has accelerated the pace of a fiber deployment across more than 60 cities that will help to provide a backbone for 5G. Verizon averaged about 1,400 new route miles per month in Q2, increased from an average of about 1,000 in Q1.

"Ultimately if you're going to do 5G, you need fiber," he said.

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— Jeff Baumgartner, Senior Editor, Light Reading

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