Service providers including Verizon and T-Mobile have exaggerated their fixed wireless access (FWA) coverage in rural areas, potentially preventing those areas from being eligible for funding in the $42.5 billion Broadband Equity Access and Deployment (BEAD) program, according to a report from Bloomberg.
At issue are reporting rules that enable providers to claim that an area has service when service isn’t yet available there but could be made available.
FWA Broadband Map Data
The Bloomberg blog post doesn’t specify the source of the inaccurate data, merely referencing it as “a government map.” But that undoubtedly is a reference to the FCC broadband map, also known as the National Broadband Map, which is based on data collected by the FCC from broadband providers.
According to Bloomberg, T-Mobile claims its fixed wireless offering can serve 45 million addresses, or more than a third of the 114 million locations listed on the government (a.k.a. FCC) maps. A Telecompetitor double-check of the map data updated February 1 shows a somewhat lower 40 million addresses for T-Mobile that would be considered served according to BEAD program rules.
Verizon claims it can cover 19 million locations, Bloomberg said. Here, too, Telecompetitor found a somewhat lower number between 17 million and 18 million locations that would be considered served by Verizon as of the February 1 map update.
As the blog post notes, a provider is allowed to indicate that an area has broadband available if the provider could “potentially reach” the area. Here, too, the blog post is short on details.
Those details: FCC rules allow providers to claim that they serve an area if they can bring service to that area within 10 days.
To put the availability numbers in perspective, T-Mobile had 2.6 million high-speed internet (a.k.a fixed wireless subscribers) as of year-end 2022 and has been adding around 500,000 customers per quarter.
Verizon’s latest earnings report for the fourth quarter of 2022 did not break out total fixed wireless subscribers. But according to a December 2022 fixed wireless report from T-Mobile that incorporated data from Leichtman Research and OpenVault, Verizon gained 870,000 FWA customers between the fourth quarter of 2021 and the third quarter of 2022. And most of Verizon’s FWA customers were gained beginning in 2022 when the company launched service using C-band spectrum.
The same report includes a T-Mobile forecast to have 7-8 million FWA customers by 2025 and a Verizon forecast to have 4-5 million FWA customers by 2025.
It’s worth noting that no service provider ever gets 100% take rates in the areas that they serve and subscribership generally builds over time, though, so the availability data could be accurate.
T-Mobile’s Response
Verizon declined to respond to a request from Bloomberg for comment, according to the blog post.
T-Mobile responded by noting that 50 million homes are “eligible” for the company’s fixed wireless offering.
Availability is “dynamic” and dependent on network capacity, T-Mobile told Bloomberg, which raises an interesting point.
Wireless carriers such as T-Mobile and Verizon make a larger margin on mobile service than they do on fixed wireless. Accordingly, T-Mobile only offers fixed wireless where it has extra capacity on its mobile network.
Based on previous T-Mobile comments, the 50-million home fixed wireless eligibility figure only includes those areas where T-Mobile has sufficient capacity to offer fixed wireless.
But this does raise the question of what happens to an area’s eligibility if traffic on the T-Mobile network in that area grows to the point where it exceeds the company’s threshold for offering fixed wireless?
A T-Mobile exec said last month that the company is considering whether there might be circumstances when a network investment aimed specifically at increasing fixed wireless capacity would be merited. He added, though, that no conclusion had been reached.
Caveats
It’s important to note that stakeholders had the opportunity to challenge the FCC broadband map data. It’s also worth noting, though, that sources have told Telecompetitor that the FCC only approved a small portion of challenges made and offered little or no detail to explain why certain challenges were rejected.
Another important point to note is that BEAD allocations will not be based on the current version of the National Broadband Map but instead will be based on an updated version. The FCC is currently in the process of gathering updated broadband availability data from service providers.
One last point: Individual states will be responsible for awarding BEAD funding to service providers to cover some of the costs of deploying service to an area. States won’t be required to use the National Broadband Map data to make those decisions but instead have the option of gathering their own broadband availability data – an option that some states already have pursued.
The Bloomberg coverage comes just days after Ars Technica published correspondence from an Ohio provider to a potential customer stating that the provider did not yet have coverage in an area but had claimed that it did so that a competitor would not be able to obtain government funding to build in that area.
