T-Mobile executives said that the company’s planned merger with Sprint would position the newly combined company to offer internet services to homes, offices and other locations—a move that would put the company into direct competition with the likes of Comcast, Charter, Verizon and other wired internet service providers.
Those statements are notable, considering T-Mobile executives for years have downplayed the opportunity for fixed wireless technology to replace wired internet connections.
During the company’s quarterly conference call today with analysts, T-Mobile’s Mike Sievert boasted of the wireless speeds that a combined Sprint and T-Mobile could provide through a combination of 5G technology running on spectrum bands including T-Mobile’s 600 MHz and Sprint’s 2.5 GHz. “That's going to 450 megabits per second within the planning horizon of this business,” he said. “That's a national average, not a place to get in some parts of some towns, like our competitors' millimeter-wave strategy that can go higher than that in very isolated places.”
Verizon and AT&T are deploying 5G services in part on millimeter-wave spectrum, and have noted that signals in such spectrum typically travel up to 2,000 feet—a much shorter distance than the miles of coverage that can be obtained through mid- and low-band spectrum typically used for wireless services. However, millimeter-wave spectrum can transmit much more data than mid- and low-band spectrum.
“So, what do you do with a nationwide average of 450 megabits per second?” asked T-Mobile’s Sievert during the carrier’s earnings call today. “Well, first you recognize that that's way higher than most people get in their home broadband today. So, of course, we can be a competitor in that space. And this is a market that's incredibly underserved; 53% of high-speed broadband customers have only one choice for high-speed broadband in their area. So there's a huge opportunity here for us to bring real competitiveness to that market for the first time."
Sievert also pointed to T-Mobile’s recent acquisition of Layer3 TV and explained how the company’s plan to deploy TV services via that acquisition will get “ratcheted up" by T-Mobile’s merger with Sprint. "Because now you have a network where you can provide that all-IP TV service not just through their home broadband connection or onto their smartphone, but through a wireless alternative to their home broadband as well,” Sievert said. “So, T-Mobile is in a position, through the New T-Mobile, to offer a quad play, if that's what the market wants."
Concluded Sievert: “This new company [resulting from the merger of Sprint and T-Mobile] will be uniquely positioned to be able to compete across all three segments of a rapidly converging market, distributing entertainment to people wherever they may be including their home, serving their home internet needs, and serving their wireless needs when they're on the go.”
Sievert’s comments on the potential for T-Mobile to provide home internet services through a fixed wireless business stand in sharp contrast to how executives have previously discussed the opportunity, prior to the merger deal between Sprint and T-Mobile.
For example, T-Mobile CTO Neville Ray wrote in September 2016 that “Verizon’s grand vision [for 5G] is that you can cancel your fixed broadband and watch Netflix at home with wireless Verizon broadband. Double yawn. How disappointing! So little imagination from these supposed network leaders!”
In December 2016, Ray offered additional commentary on the topic: “The carriers’ current vision for 5G is mind-numbingly limited. 5G’s potential is so much larger than replacing in-home broadband and IoT. But they can’t see beyond their own wallets. AT&T wants to ‘connect your world’—including your bank account—to AT&T. Verizon’s grand vision is that you Netflix at home with wireless Verizon broadband. How is that game changing?”
However, in recent months Ray has acknowledged that T-Mobile could potentially offer a fixed wireless product, though he has said the operator is maintaining a focus on mobile 5G.