Verizon rural partner expecting upside from roaming revenues

Verizon Wireless' (NYSE:VZ) LTE in Rural America program is extending its reach to Ketchikan, Alaska, via an agreement with KPU Telecommunications.

KPU, one of three divisions of Ketchikan Public Utilities, is owned by town residents. The company is a triple-play service provider, delivering TV, Internet and phone service over some 6,000 access lines in southeastern Alaska.

In March, the Ketchikan City Council unanimously approved KPU's request to form a partnership with Verizon. According to KRBD public radio, KPU Telecom Manager Ed Cushing said at the time that possible LTE roaming revenues would provide an upside for the small, rural carrier.

"KPU will receive roaming revenue from Verizon, so if a Verizon customer visits from the lower 48 or an international area, [sic] visits Ketchikan for example of a cruise ship, their traffic will roam on KPU's network and Verizon will compensate KPU for that activity," said Cushing.

"On a much smaller scale, KPU will pay Verizon outside of Ketchikan if a customer we've signed up is in Manhattan or Seattle or wherever," he added, noting the roaming fees KPU will pay Verizon pale in comparison to the fees KPU is likely to accrue from the much larger Verizon and its customer base.

"Our decision to deploy 4G LTE technology ensures that we will be able to offer wireless customers in Ketchikan the same state-of-the-art LTE network capabilities that are being deployed in larger urban markets in the United States and around the world. This will result in enhanced high-speed wireless data services for our customers locally and when traveling away from home," said KPU General Manager Karl Amylon.

Verizon announced its rural LTE initiative in June 2010. The program allows small operators to launch LTE more quickly by leasing the larger operator's spectrum in the upper 700 MHz band for a mobile broadband network that the smaller operator builds and operates. Verizon Wireless also provides core services to allow tight integration with its nationwide LTE network.

The program has just under 20 rural wireless carriers, according to Telecompetitor.

For more:
- see this Telecompetitor article
- see this RCR Wireless article

Related articles:
Bluegrass takes wraps off fixed LTE service in Kentucky
Small operators prep for LTE, despite uncertainties
MTPCS' Cellular One joins Verizon Rural America LTE program
Verizon expects 6 rural LTE carrier partners to launch by year-end
Bluegrass Cellular launches service through Verizon's rural LTE program
Pioneer Cellular launches LTE under Verizon rural partner program

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