The new Verizon Wireless HomeFusion service, which will offer fixed broadband access using the Long Term Evolution network initially in Dallas, Nashville, Tenn., and Birmingham, Ala., ultimately will provide a facilities-based fixed wireless service anywhere Verizon’s fourth generation network operates.
The big issue is what HomeFusion means for U.S. broadband competition.
Some will say the service will appeal primarily to homes in rural or remote areas that cannot buy cable modem service or digital subscriber line or fiber to the home service. If that proves to be the case, the primary competition are satellite broadband providers and rural telcos and cable companies.
Others might not be so sure. Where will LTE facilities be built first? In the major markets where there are lots of potential customers and high data demand. That doesn’t fit with the “rural areas” application all that well.
So some might characterize the service as a facilities-based way for Verizon to sell fixed broadband outside the areas where it already provides FiOS or other fixed network service.
In that case, the primary competition will be out-of-market fixed line providers, whether other telcos or cable companies, up to a point. The reason is the bandwidth caps. A consuming household that watches lots of streaming video will quickly find the HomeFusion bandwidth cap to be an issue.
But not every household that values and users fixed broadband consumes 10 Gbytes a month. As is already the case for mobile broadband dongle service, where some users find sufficient value and capacity to replace a fixed line service with a mobile broadband service with a 5 Gbyte usage cap, some households will find a 10-Gbyte cap quite adequate.
What it means, perhaps, is that the national Long Term Evolution network represents a facilities-based network that can be used to sell fixed broadband connections, to many consumers, “out of region” with respect to Verizon’s fixed line service territory. And that out of region business might represent 80 percent of U.S. homes.
Since Verizon has largely completed it in-region fixed network upgrade to FiOS (with a couple of exceptions), the HomeFusion effort does not represent an alternative to upgrading to FiOS in region. For one thing, the consumption caps are too low to support a typical fixed network amount of data consumption, which, by some estimates, is about 15 Gbytes a month, per households.
LTE might be a very-reasonable way to pick up fixed broadband market share for users who presently do not watch lots of streaming video, do not plan to do so, and might therefore be perfectly happy with 10 Gbytes a month of usage.
The receive hardware costs $200, but installation appears to be free. Service “starts” at $60 per month for 10 gigabytes of data. That implies there will be other packages offering bigger buckets of usage for more money.
Verizon hasn’t yet said what those other packages might entail.
Verizon says the service will provide downstream service at 5 Mbps to 12 Mbps. Upstream speeds are said to range between 2 Mbps and 5 Mbps. Real world speeds might be faster or slower, depending on time of day and number of users on the network.