Verizon just shared new details with Wall Street its 5G strategy but also walked back a key projection
- At an analyst event on Thursday, Verizon announced it would launch mobile 5G service in more than 30 US cities this year.
- It expects to release the first 5G-capable smartphone in the first half of the year.
- Verizon also walked back previous comments about plans to grow its new 5G Home service.
Verizon will launch its mobile 5G network in more than 30 US cities in 2019, the company said at an event it held for investors on Thursday. Verizon didn't identify the cities or how much the service would cost.
The company also said its first 5G-capable Samsung Galaxy smartphone would be available in the first half of 2019, limited to Verizon subscribers. Verizon said it expects to be about 18 months ahead of rivals in adopting mobile 5G.
While Verizon broke news about its mobile 5G strategy, the company hedged plans for the rollout of its 5G Home service. Verizon launched the service in four markets in October. The service provides 5G fixed-wireless broadband using radio signals and the installation of an antenna outside of the home to deliver internet.
"We certainly still see line of sight to getting to 30 million households in the US with that product over the next few years," Verizon CFO Matt Ellis said at an event last November.
At today's investor event, Verizon CTO Kyle Malady qualified that statement, saying the company could get to the 30 million figure in five to eight years based on current technology and generation of 5G. But other factors like new technologies and speeds marketed to consumers need to be considered, he said.
In Verizon's first four test cities, the company marketed 300 megabit per second speeds. But not all customers want such fast speeds, and in many cases, 100 will suffice, he said. Providing 100 megabit-per-second speeds would let Verizon cover more households. But in competitive markets, people will expect 750 megabit or 1 gigabit speeds, so coverage would be lower, he said.
The company will focus on where it will get the best return on investment, he said, and not necessarily try "to chase some household number."
An analyst at the event seized on Verizon's wavering commitment to reach its 5G Home projection. "Kyle [Malady] seemed to walk back the 30 million homes passed for fixed wireless broadband a little bit," Cowen analyst Colby Synesael said to Verizon CEO Hans Vestberg. "That's been a focus for investors ever since you gave that metric."
Verizon hasn't said how many consumers have signed up for 5G Home, other than to say that about half of the customers who signed up were new to Verizon. The company said it expects its 5G business to be a meaningful contribution by 2021.
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