Verizon feels the heat as it rolls out spectrum for upgraded 5G
The telecommunications giant reports big losses of wireless subscribers in the first quarter of 2021 as competition heats up.
Competition in wireless is building up as Verizon reports heavy losses in wireless customers in the first quarter of 2021. The company is in the early stages of rolling out new spectrum for its next-generation 5G service. And as executives have warned for months, the competition with rivals AT&T and T-Mobile is intensifying.
Still, the telecommunications giant said its core business is still doing well, and it managed to beat analyst expectations for its earnings and revenue. The company reported adjusted earnings per share of $1.31, slightly higher than the $1.29 earnings per share analysts had expected, according to Yahoo Finance. Revenue also beat Wall Street expectations as the company reported consolidated revenue of $32.9 billion compared with $32.46 billion expected by analysts.
Verizon lost 326,000 consumer wireless customers with postpaid accounts. This included 225,000 customers using smartphones. Postpaid accounts belong to customers who pay their bills at the end of the month, and they are very valuable to wireless carriers.
On the home broadband side of the business, Verizon reported that it added 98,000 consumer Fios customers. In total, the company added 102,000 Fios customers. But Verizon continued to lose TV subscribers, reporting it lost 82,000 pay TV subscribers for its Fios consumer video service in the first quarter.
The news comes as Verizon begins deployment of its 5G Ultra Wideband and fixed wireless broadband service on the so-called C-band spectrum, which the company bought earlier this year.
CEO Hans Vestberg has touted the purchase of this spectrum as a "once-in-a-lifetime opportunity."
The C-band is midband spectrum that is viewed by the wireless industry as a key technology for offering faster 5G performance. Midband spectrum like C-band offers a good mix of capability that complements low-band spectrum, which features greater reach, and ultra-high-band spectrum, which transmits over very short distances at super high speeds.
Verizon claims the new C-band spectrum will allow it to offer peak download speeds of 1 gigabit per second. Verizon is expected to cover 100 million people in 46 markets this year with the service using C-band. It expects that the service will cover 175 million people between 2022 and 2023 and over 250 million people in 2024.