Verizon has been selling its 5G Home service for just over a month now, and the carrier and others have provided a few insights into how the offering is performing both from a technical standpoint and a business standpoint.
Who is buying it
Half of the customers who have subscribed to Verizon’s 5G Home service were not Verizon customers previously, according to the Wall Street analysts at Deutsche Bank, who wrote about their meetings with Verizon in a note to investors. That’s a key statistic because it indicates that Verizon’s in-home, fixed wireless service is appealing to both the carrier’s existing mobile customers as well as new customers.
Verizon’s 5G Home offering, currently available in parts of four cities, blasts internet services in its 28 GHz spectrum to stationary receivers in nearby homes and offices. Verizon is positioning the offering as an alternative to wired internet services from the likes of Charter and Comcast. Verizon is selling 5G Home services, with speeds of around 300 Mbps, to its existing mobile customers for $50 per month and to customers who don’t subscribe to its mobile phone service for $70 per month.
Thus, Verizon’s 5G Home strategy may help to expand its mobile customer base by offering discounts to internet customers who also subscribe to Verizon’s mobile phone service. (Ironically, Comcast and Charter have a similar strategy to bundle fixed and mobile services, although their respective mobile offerings, Xfinity Mobile and Spectrum Mobile, both run on the Verizon network.)
How it’s installed
According to the analysts at Deutsche Bank, the time it takes Verizon to install 5G Home service in a new customer’s location has dropped 25% since the beginning of October, when Verizon first launched the service. The analysts added that the time it takes a Verizon installation technician to find the best signal location in the home has been cut in half.
Verizon’s 5G Home service must be installed by a technician from the company because it requires a receiver on the inside or outside of a customer's home. Verizon had hinted that it was toying with a self-installation model—where a customer could install their own receiver—but the operator has said it plans to continue to have its own technicians conduct the installation so that customers don’t have a bad experience with the product.
Indeed, Verizon CFO Matt Ellis addressed the issue during an appearance at an investor conference earlier this month: “Just like when we launched our FiOS product 12 years ago, our first installs were very different than what they evolved to over time and very quickly,” he said, according to a Seeking Alpha transcript of his remarks. “So we're getting great experience with the consumer in terms of doing the installs. As these are early customers, we're not just doing the install and leave them, we're staying in touch with those customers and getting a lot of good feedback in terms of they like the significant increase in speed they're getting versus their prior broadband that they were getting from another third party.”
How fast it goes
Although Verizon’s CEO initially discussed speeds of 1 Gbps over 5G, Verizon launched its 5G Home service with the promise of consistent 300 Mbps speeds. However, according to a number of sources, the operator is consistently providing speeds well above that threshold. Specifically, a video produced by Verizon offers some real-world test results and commentary from initial 5G Home customers:
Those results dovetail with independent test results from Mike Thelander and Emil Olbrich of Signals Research Group. As noted by RCR Wireless News, the analysts found speeds of 600 to 800 Mbps.
“And in some cases—a lot of cases, at speeds higher than the minimums that we promised in the commercial offerings. So it's great to have a commercial 5G product out there,” Verizon’s Ellis noted.
However, those speeds could change as Verizon adds customers to its network.
What’s next
Verizon has made it clear that it will launch a mobile 5G service sometime next year. As for its 5G Home service, the company has said it plans to expand the offering to a total of 30 million households in the United States (there are a total of 126 million households in the United States) over the next few years.
Further, Verizon may reach that target while spending less on its network than in previous years. Already, Verizon has said it expects to spend less on its network this year than it initially planned, and the analysts at Deutsche Bank expect that slower spending to continue: “As we have noted in the past, we do not expect a significant spike in capex in 2019,” the analysts wrote, noting they expect Verizon’s capex in 2019 to rise by 4% to $17.6 billion.