As one might expect, cellular operators’ unlimited data plans are having a positive impact on Boingo Wireless’ business, with the company reporting another quarter of double-digit revenue growth. And the company’s CEO says 5G will represent still more opportunity.
“We are very bullish on what 5G will represent for us as an opportunity,” CEO David Hagan told investment analysts during the quarterly earnings call.
Boingo is in the midst of a winning streak in that its second quarter extended its double-digit revenue growth to 11 consecutive quarters, with revenue up 25.5% year over year at $49 million, at the high end of its guidance range of $47.5 million.
Boingo Wireless is many things: Wi-Fi offload provider to Sprint and another unnamed carrier; Distributed Antenna System (DAS) provider in venues across the country; and supplier of Wi-Fi and small cells, in addition to connecting military bases with wireless coverage.
One of the two carriers Boingo is working with is putting traffic on two military bases, Hagan said. Typically on the military bases cell coverage is weak, so carriers are looking to change that.
As for small cells, the company is in talks with all four major U.S. carriers and has specific proposals for deployments involving thousands of locations, Hagan said. “Activity is very high and we expect to be able to report on specific installations in the quarters ahead,” he said, according to a Seeking Alpha transcript. “Small cells are very exciting, because they effectively expand our addressable market for venues and allow us to pursue new venues that may not have made financial sense in the past.”
Boingo is also involved in CBRS specification groups and it’s participating in trials, he said. Similar to Wi-Fi, CBRS represents another network for the company to deploy in and work with carriers.
A member of the CBRS Alliance, Boingo recently filed at the FCC in support of T-Mobile’s petition for rulemaking, asking that the 3.5 GHz rules be changed to make it more favorable for carrier investment. Specifically, Boingo said it agrees that a license term of less than 10 years is not sufficient to ensure that licensees will be able to recover a return on investment. As a neutral host operator, Boingo would be negatively affected if carriers were less willing to invest in networks with shorter than 10-year license terms.
Interestingly, Boingo, which believes it’s the largest provider of indoor DAS networks in the world, continues to have a significant backlog in terms of venues it has acquired and venues it has actually built out. It takes anywhere from 18 months to 24 months from venue acquisition to ultimately when it starts to see revenue coming in from a carrier.
That’s because once it has a contract in place with the venue, then it reaches out to the big four carriers and begins the negotiation on who becomes anchor or co-anchors. That's not a fast-moving process, Hagan said. Boingo has to make sure it’s aligned with each carrier’s capex budget, and there’s a lot of negotiation that goes on. The building and design is the easy part; it’s the negotiation on the front end that’s the hard part, he said.