Verizon fixed wireless access (FWA) margins for business customers are two times that of a mobile wireless line, according to a research note released today from SVB MoffettNathanson based on a conversation between MoffettNathanson financial analysts and Sampath Sowmyanarayan, executive vice president and CEO of Verizon Business.
Key reasons are that business customers do not use as much data as consumers do and the provider doesn’t have to offer device subsidies.
Sowmyanarayan also told the analysts that between 50% and 60% of FWA customers are coming from cable. Many of the other customers are businesses such as food trucks and construction companies that can’t use wireline alternatives.
Perhaps surprisingly, a key selling point for Verizon FWA is its reliability in comparison with wired alternatives.
“Cable’s outside plant issues can take days to resolve, a particularly critical issue in B2B, where Cable has had a growing presence,” the analysts wrote.
Fixed wireless provider Starry made a similar observation a few months ago.
The SVP MoffettNathanson research note was released the same day that Verizon said it had expanded the 5G versions of its FWA offering, known as Verizon 5G Home Internet and Verizon 5G Business Internet, to several more markets, including Colorado Springs, CO; Monroe Co., NY; and Bradenton and West Palm Beach-area, FL.
Broad Coverage is Key
Another key factor for Verizon in selling FWA to the business market is coverage.
“The fixed wireless product allows Verizon to immediately offer a nationwide broadband service despite having a limited wireline (fiber) footprint,” the analysts wrote.
Verizon FWA reaches almost all the nation’s 16 million business locations with some form of FWA. In most cases, it’s via LTE, although 5 million locations are covered with 5G.
Business customers like the near-ubiquitous coverage because it eliminates the need to use multiple providers.
On the consumer side, Sowmyanarayan cited fast installation time as a key advantage against cable.