As fixed wireless access (FWA) broadband grows in popularity, the major carriers face key decisions about how to deploy it. Among the most important is whether the technology makes sense in areas where consumers and businesses already have options. A recent report by MoffettNathanson Research made it clear that both AT&T (through the acquisition of about 30 MHz of nationwide 3.45 GHz spectrum from Echostar) and Verizon (through the acquisition of Starry) have accepted FWA as an important tool.
The question posed in the report — titled “US. Wireless and U.S. Broadband: Is the FWA Market Big Enough for Three?” — is how much market share a second or third entrant into a market can expect to win.
It is an issue the companies must deal with now. MoffettNathanson, working with data from Opensignal, found that about 80% of households nationwide are in areas served by at least one FWA player. An ever-increasing percentage have two providers, and 13% have three.
The answer comes down to math. The availability of FWA is expected to rise. The report said that the big three will not overbuild their own fiber. Once pending transactions are complete, a bit more than half the country will have fiber, mostly owned by AT&T and Verizon. The report said the “natural limit” for three-player markets is about half the country. This amount open for third players will drop as fiber expands.
The report said that FWA providers must both compete for the current market share and expand the market.
“According to Opensignal’s vast dataset, about 9.9% of the in-home Wi-Fi routers to which wireless subscribers connect today are from FWA providers,” the report said. “That 9.9% average market share is the weighted average of 7.2% FWA share in one player markets, 10.7% FWA share in two-player FWA markets, and 13.4% FWA share in three-player FWA markets.”
The bottom line is that the amount of growth each new entrant can expect will decrease as the field of competitors gets more crowded.
The report concluded that even the carrier with the biggest footprint, AT&T, only covers about a quarter of the country. The company, as well as Verizon, will rely on FWA to expand. The question is whether the technology is up to the challenge.
Big questions — and big decisions — lie ahead. “But how well does FWA compete? There is clearly a segment of the market that finds FWA’s low prices and no-hassle installation to be a worthwhile tradeoff for lower speeds and lower reliability. But is that a size-limited segment? Does a single carrier capture the opportunity in a given market, or do second and third entrants expand the pie?” the report asked.
The ascendency of FWA tracked by the MoffettNathanson Research report has been noted by J.D. Power and Horowitz Research, too.
Earlier this month, J.D. Power found the percentage of FWA subscribers with their provider for less than six months was nine percentage points greater than fiber subscribers. This suggests significant acceptance of the new technology.
Telecompetitor spoke with J.D. Power Senior Director of Technology/Media/Telecom Practice Carl Lepper, who said FWA was gaining traction.
“The trends from a customer point of view are very positive,” Lepper told Telecompetitor. “They’re getting outstanding customer experience scores across the board. Compared to the rest of the internet market, they’re incredibly competitive from a customer experience point of view.”
And in late April, a Horowitz Research report found that 56% of non-FWA subscribers are likely to consider FWA when it becomes available in their area. Penetration overall was at 12%, which Horowitz says is a three-fold increase since it inaugurated coverage in 2023.
