How Will Verizon's LTE Networks Get Filled?

Carl Weinschenk
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One of the interesting questions that must be answered during the next year or so is whether the take rate and penetration of 4G LTE networks will be worth the investments that are being made in them.

This issue wasn't even on the radar screen for most observers until Verizon Wireless acknowledged at a media conference a few weeks ago that only about 5 percent of its subscribers were on its 4G network.

Five percent of anything isn't much. But it's also important to recognize that the network doesn't involve building new cell towers or other infrastructure. So the investment, while surely significant, isn't akin to building the network from scratch. In addition, even if the new network isn't bursting at its seams, the 3G network is - and the LTE capacity certainly will relieve some pressure. That all suggests that the value of the LTE network should be measured in more than simple subscriber numbers.

A couple of pieces of news during the past two days likely will add subscribers to Verizon Wireless' 4G network - and suggest how the network gradually will be built out. The big news, of course, is that Apple took the wraps off the next version of the iPad, which will run on Verizon's 3G and 4G networks (as well as others). Indeed, it seems that Apple's use of the 4G network in support of the new iPad has kicked off before the device is even available.

Earlier in the week, Verizon Wireless introduced HomeFusion Broadband. Essentially, the 4G network will deliver signals through an antenna to a router in the home. It is primarily intended for rural and other areas underserved by cable operators and telcos. This could be a very big business for Verizon and for carriers that undoubtedly will follow suit. Not everyone is sold on the new service, however. Indeed, PCMag's Sascha Segan says that essentially it is a non-starter.

In retrospect, it never was a slam dunk that the LTE networks would find widespread demand. 3G is fine for many folks. But demand certainly will build for the Verizon, AT&T and other carriers' LTE networks among consumers and corporate customers. The network will justify itself, though it will take time. Expect many more initiatives, big and small, as time passes.

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