The CEO of the nation's third largest cable company, Charter Communications, said that he is not concerned about the mobile industry’s 5G push. Those comments are specifically noteworthy considering Verizon announced this week that it will use 5G technology to directly challenge Charter, Comcast and other cable companies in the home internet space in up to 30 million households across the country.
“5G is a technology,” Charter’s Tom Rutledge told CNBC. “We have a better platform to deploy that technology, I think, than the cellular industry does because we are fully distributed from a high-capacity wireline perspective. If you think about what 5G is, it is small cells. Small cells mean you need lots of wireline connectivity to make the small cells work. We think we are actually in a better position to do that than traditional cellular companies. Yes, 5G can be used to compete against us. It is very capital-intensive. It requires essentially a wireline network like a FiOS to support the small cells.”
As for Verizon’s 5G Home service specifically, Rutledge said that by the end of this year Charter will be able to offer 1 Gbps speeds across its footprint via DOCSIS 3.1 technology, and in the coming years will be able to increase those speeds to 10 Gbps symmetrical via DOCSIS 3.1 Full Duplex. And that, he said, positions Charter well against 5G.
"I think 10 years from now, we'll have 10-Gig symmetrical [service] everywhere," Rutledge said during an investor relations event, according to Light Reading. "We'll have a superior network everywhere."
Verizon's planned fixed-wireless network is "essentially a cable TV system or fiber network [running] to a radio on a pole," he added. "It really is a cable system with a more expensive drop."
Those comments are particularly noteworthy coming just days after the wireless industry’s MWC Americas trade show in Los Angeles. Verizon used that event to launch its new 5G Home service, which uses 28 GHz spectrum to beam monthly home or office internet services for $50 for Verizon’s mobile customers and $70 for those without Verizon’s mobile service. The service will provide average speeds of 300 Mbps and peak speeds reaching 1 Gbps. However, Verizon’s service requires a technician to install a receiver at the customer’s location, and it will initially use Verizon’s proprietary 5GTF transmission standard. (Verizon said it will swap out that equipment later with equipment that supports the 3GPP’s 5G NR standard.)
Verizon is launching the service in parts of four cities this year and has said it will expand the offer to up to 30 million households in the coming years; Wall Street analysts believe that build-out will be finished by 2024. Meanwhile, Verizon has also said it will launch mobile 5G services likely by the middle of next year.
Nonetheless, Verizon’s 5G Home service essentially represents a new front in the battle between the mobile industry, as represented by Verizon, and the cable industry, as represented by Comcast and Charter. Importantly, both Comcast and Charter now offer a mobile component to their wired internet offerings; both companies are leveraging MVNO relationships with Verizon to offer smartphone services.
And that offering specifically will allow Charter’s Spectrum Mobile to undercut mobile service providers’ pricing by up to 50% while still making a profit, Rutledge argued, likely thanks to the cable industry’s extensive Wi-Fi deployment. "So consumers will get significant savings and we will still have margins in the wireless business," he said.