WISPs love the fixed wireless momentum, but face competition — Moore

Jeff Moore Industry Voices

WISPAmerica 2022 — an annual event for wireless internet services providers (WISPs) — was held in New Orleans last week. I attended so I could check the pulse of the fixed wireless industry as it exists in 2022.

The WISPAmerca event occurs each spring, organized by the trade group WISPA. The group also organizes a fall event, WISPApalooza, which is slated for October 3-6 in Las Vegas.

Last week's event was successful. WISPA announced that it had more than 1,250 attendees and more than 120 exhibit booths, breaking previous WISPAmerica records. The morning sessions were packed, I noticed. I chatted with numerous people who are operating wireless internet services, and they generally seemed upbeat and full of energy.

Reasons for optimism

The WISPs should be optimistic. They served 4 million subscribers in 2016, but the number is now 6.7 million and could grow to 12.7 million in 2025, based on a report by the Carmel Group. Jimmy Schaeffler of the Carmel Group gave a presentation at the conference, saying that revenues per subscriber have been rising while subscriber acquisition costs have been falling. There are now more than 2,800 WISPs, with many of them also serving homes via fiber.

The pandemic propelled WISPs. More people are working from home and some people have found that they can work remotely from small towns — where housing prices and crime are low — and such towns are often served by WISPs. There has been an increase in demand for internet access in general, whether wireline or wireless.

On March 10, the FCC announced that it is ready to authorize more than $640 million through the Rural Digital Opportunity Fund. “To date, the program has provided $4.7 billion in funding to nearly 300 carriers for new deployments in 47 states to bring broadband to almost 2.7 million locations,” said the FCC.

And not all funding is federal. Microsoft’s Airband initiative has a mission of “closing the rural broadband gap.”

WISPs are gaining more spectrum, which enables them to provide stronger signals. Concerning the CBRS auction, Inside Towers reported in September 2020, “Close to 70 WISPA members — small companies which generally serve hard to reach rural communities — placed winning bids for over 3,600 licenses in more than 1,350 counties, representing more than 17% of all the licenses won.”

And not long ago, the FCC took action to enable more than 100 WISPs to use spectrum in the 5.9 GHz band, as Alpha Wireless blogged last April.

New competition for WISPs

This was the first WISPA conference to occur after Verizon and T-Mobile entered the market for fixed wireless, using extra capacity from their mobile networks. Fixed wireless subscriber counts as 2021 ended were 646,000 for T-Mobile, more than 500,000 for AT&T, and 223,000 for Verizon. In Q4 2021 alone, T-Mobile added 224,000 fixed wireless subscribers. These strong gains were achieved without strong marketing. Sure, there was a Super Bowl TV ad for the service, but that was only last month.

I’m not surprised about this. I wrote “Fixed wireless gets real” in an Industry Voices piece in April 2020.

The scene is set for the national carriers to seriously ramp their fixed wireless subscriber adds. T-Mobile is projecting 7-8 million fixed wireless subscribers by 2025. Just this month, Verizon announced that it plans to have 175 million PoPs of 5G Ultra Wideband coverage by the end of 2022. Offers could have an impact as well, such as the offer of Verizon 5G Home at $25/month for Verizon Wireless customers who are on premium unlimited plans.

It gets better. Wave7 Research in February broke the story to its readers about sales of T-Mobile Home Internet at Metro by T-Mobile stores. Every Metro by T-Mobile store checked since late February has had supply of gateways for the service. In March, we are beginning to see signage for it at these stores. I was shocked during a March 8 visit to a Metro store when a Metro rep not only asserted that the service was selling, she gestured toward a woman who has already purchased the service. The woman gave me an impromptu, upbeat testimonial about her new internet service. T-Mobile announced availability of the service at Metro by T-Mobile stores on March 10.

The new competition is not only from the national carriers. During the conference, Carmel Group noted a 28% uptick in the percentage of WISPs concerned about satellite competition and the rise of megaconstellations from low-Earth orbit providers such as Starlink.

The WISPs’ reaction?

At WISPAmerica 2022, I told some officials for WISPs about the increasing competition from top carriers. Responses were mixed. Some had concerned looks on their faces, and they asked me for more details. Others sounded skeptical, saying that their responsive, local customer service would win the day.

Without question, WISPs have a head start of years or even decades in their local markets. Customers in some cases went to school with WISP workers or attend church with them or perhaps they play on the same sports team.

One topic of discussion at WISPAmerica 2022 was the reality that many WISPs are also serving customers via fiber. This is consistent with Wave7 Research’s findings. There was even some discussion of changing the name of the association to reflect this reality. “Let’s pick the right tool for the job, which in some cases may be fiber and in some instances it may be wireless,” WISPA President Claude Aiken told Broadband Breakfast soon after the conference.

I agree with Aiken. Usually, wireless Internet is cheaper to deploy, but the choice of technology may depend on terrain, population density, availability of spectrum and other factors.

Moving from the minor league to the major league

Ironically, just as WISPs have plenty of momentum, they are getting more competition. The analogy is going from minor league baseball competition to major league competition. In the major leagues, the pitching, the hitting and the fielding will all be better, so players have to adapt. When T-Mobile and Verizon come to town, WISPs will have to adapt. One difference? The WISPs will always be the home team.

Jeff Moore is Principal of Wave7 Research, a wireless research firm that covers U.S. postpaid, prepaid, and smartphone competition.  Jeff has 25 years of telecom industry experience, including 13 years of competitive intelligence work for Sprint. Follow him on Twitter @wave7jeff.

Industry Voices are opinion columns written by outside contributors—often industry experts or analysts—who are invited to the conversation by FierceWireless staff. They do not represent the opinions of FierceWireless.