Half Of Smartphone Users Incorrectly Think They Already Have 5G

from the don't-believe-the-hype dept

With smartphone sales plateauing the last few years, handset vendors and wireless carriers have worked overtime trying to make 5G seem like it's something utterly revolutionary in the hopes of driving more phone upgrades. The problem: U.S. 5G is more evolutionary than revolutionary. And researchers who've been running U.S. 5G networks through their paces have made it clear that U.S. 5G is much slower than most overseas 5G networks (largely due to a lack of fiber, regulatory incompetence, and not enough mid-band spectrum).

Despite all the dumb lobbyist hype about the need to win the "race to 5G," we're nowhere close to doing so. One recent OpenSignal study showed how the U.S. ranked last in a study comparing 5G speeds in a list of 13 developed nations:

Not only is U.S. 5G slower than a long list of countries, researchers from both PC Magazine and the Washington Post have found that U.S. 5G deployments are, in many locations, slower than 4G. More specifically, PC Magazine found that AT&T's mobile 5G network was actually slower than the company's 4G network in 21 out of 22 cities tested. That's assuming 5G can be found at all, a tricky proposition given wireless carriers have been actively misrepresenting where 5G is available by using fake phone icons or simply, much like they did with 3G and 4G, lying about coverage without government penalty.

This reality is a far cry from carrier claims that 5G will create the smart cities of tomorrow, cure cancer, or otherwise completely revolutionize communications. Meanwhile, surveys suggest that convincing consumers they need to upgrade to 5G right now will be an uphill climb. One survey this week found that nearly 50% of smartphone owners think they already have 5G. The general consensus among consumers so far is one of confusion, probably not helped by AT&T's longstanding decision to pretend 4G is 5G:

"Nearly half (49%) of U.S. consumers (across all major carriers) believe their current iPhone is capable of accessing 5G, despite the fact that the first Apple 5G phone is not yet available – according to a recently released Global Wireless Solutions (GWS) survey of 5,000 U.S. smartphone users. More broadly, 29% of all consumers with smartphones are unsure if their current device is 5G capable, while 38% of consumers do not know if their wireless carrier provides 5G coverage where they live."

Yes, 5G will provide faster, lower latency, more reliable networks over the next decade. And speeds will improve when (if?) the U.S. drives more mid-band spectrum for public use, addresses (or even acknowledges) regulatory capture, and we more broadly deploy fiber (needed for 5G tower backhaul) to the parts of the nation carriers have spent years trying to ignore. But most studies show that U.S. consumers are far more interested in a lower bill than they are 5G. And with the industry rushing toward Canadian style consolidation and less competition, that's likely going to be the last thing on the menu.

Filed Under: 5g, hype, lies, truth in advertising
Companies: at&t, verizon

Verizon's New 'Nationwide' 5G Isn't Nationwide, Barely Faster Than 4G

from the that-word,-it-does-not-mean-what-you-think-it-means dept

While unveiling its shiny new 5G-enabled iPhones this week, Apple brought Verizon CEO Hans Vestberg to the stage to declare that Verizon had launched an updated, "nationwide" 5G network that shores up the company's 5G coverage. Until now, Verizon has largely embraced "high band" or millimeter wave 5G, which provides amazing speeds if you're near an antenna, but suffers from terrible range and building wall penetration issues. As a result, the company has been routinely criticized for comically overstating not only what 5G is capable of, but where 5G is available.

To attack this credibility problem, and drive some hype for the new iPhones, Verizon announced that it was dramatically expanding its 5G network to 200 million more people.* To do so, Verizon's using "dynamic spectrum sharing" (DSS) that helps utilize some existing 4G channels to offer 5G. The problem: Vestberg wouldn't state what speeds this new "5G" service operates at, because it's not likely to be much faster than existing 4G. It will however make the "5G" icon on your phone light up, which is helpful for marketing purposes:

"As there's going to be no additional airwaves in use, you shouldn't expect much better speeds than on 4G. 5G shines when it has big, broad lanes to itself. On the other hand, this lets Verizon manage a transition from 4G to 5G smoothly, and lets it light up a 5G icon on many people's phones for marketing reasons."

In time, 5G will provide faster, more reliable, lower-latency networks. But Verizon has repeatedly tried to advertise 5G as less evolutionary and more revolutionary, claiming (falsely) that it's akin to the "fourth industrial revolution," will revolutionize cancer treatment (something doctors I've talked to have laughed at), and will result in amazing next-generation smart cities of tomorrow. In reality it's an incremental upgrade that's good but not game changing, especially given a recent study showed Verizon 5G was available just 0.4% of the time in the real world.

Several problems: one, a self-regulatory oversight system constructed by the telecom sector to pre-empt real regulatory action declares it fine to abuse the word "nationwide," (something T-Mobile is doing as well). *And the FCC, for decades, has done a piss poor job verifying the chasm between marketing hype, ISP claims, and actual availability. Regulatory capture also means industry sees little meaningful penalty for lying about coverage, so they, you know, keep doing it.

In wireless carrier and handset vendor PR land, 5G is an incredible, revolutionary upgrade that changes everything. With smartphone innovation flailing and overall sales lagging, they're eager to drive mass upgrades by portraying 5G as something more substantive than it is.

Here in reality, U.S. 5G continues to be far slower than a long list of overseas networks because we've done a poor job making mid-band spectrum available for public use and driving fiber to lower ROI areas (despite billions upon billions in subsidization). And numerous studies have found that current 5G is in some instances slower than 4G. In a few years as more mid-band spectrum is pushed to market this will steadily improve. But right now, consumers (correctly) don't really see 5G as worth it, which is a major reason why Verizon had to back off plans to charge a $10 monthly premium just to access it.

Filed Under: 5g, exaggeration, hype, truth in advertising
Companies: verizon

Verizon Is Still Abusing The Hell Out Of The Word 'Unlimited'

from the beating-up-the-dictionary dept

Back in 2007, Verizon was forced to strike an agreement with the New York State Attorney General for falsely marketing data plans as "unlimited" when the plans had very clear limits. Thirteen years later and it's not clear the company has learned much of anything.

Verizon's 2020 wireless plans still falsely claim that users get "unlimited" data for a premium price point on top of base surcharges. But you're to ignore that things like HD and 4K streaming cost extra. Or the fact that if you're enrolled in something like Verizon's recent "Unlimited Plus" plan, "unlimited data" is defined as up to 15 GB of usage, after which your connection is throttled for the remainder of the billing cycle. Such surcharges of course don't include additional fees to connect additional devices to this so-called "unlimited" connection, be it your Apple Watch or your tablet.

Verizon recently updated this plan, offering double the data allotment (30 GB) when connected to Verizon's 4G LTE network, while providing "unlimited data" while users are connected to its newer 5G network:

"Unlimited Plus gives customers double the 4G LTE premium data for jetpacks, tablets and laptops, and includes unlimited access to blazing-fast 5G Ultra Wideband speeds when connected on 5G Ultra Wideband devices."

While that superficially sounds nice, Verizon's 5G network is barely available to the vast majority of customers. One recent study found that due to coverage issues with the millimeter wave spectrum Verizon is using for 5G, 5G was available roughly 0.4% of the time even in "launched" markets. The other problem? Verizon's "unlimited" plans continue to include not only a ban on faster HD and 4K streaming (unless you pay more), but all manner of additional surcharges to connect additional devices to your already pricey connection:

"As of late last week, Verizon introduced a new version of its “Unlimited Plus” plan, which attaches to existing wireless plans for an extra $30 a month. Then, if you would like to connect more devices to your plan beyond your phone, you can sign up for an unlimited connected device plan and upgrade to Unlimited Plus for another $10 a month. If you have a tablet or hotspot, Verizon will sell you another unlimited plan for those for an extra $20 a month.

The new “Unlimited Plus” offers unlimited-unlimited 5G and up to 30 GB of “premium” 4G LTE data. So it appears you get double the unlimited data as well as an infinite amount of 5G service which is probably not provided in your area (or if you turn the corner, or go indoors in an area that has the service). But if you are connecting a hotspot, laptop, or tablet to your plan, then Verizon redefines unlimited again, this time to mean up to 50 GB of 5G data (almost not available anywhere) and then you get speed throttled to 3 Mbps for the rest of the billing cycle, but just on those devices."

There's simply no way the majority of normal consumers actually understand what most of this means. And that's of course quite by design. One, the complexity and caveats make it difficult to impossible to compare Verizon's pricing to its competitors. That helps mask the fact that U.S. wireless subscribers pay not only some of the highest prices in the developed world for wireless data, but those connections are some both some of the slowest in the world, and inundated with all kinds of murky restrictions on what you can do with your new connection. How innovative!

The other major benefit is that consumers confused by these plans will generally subscribe to the most expensive plan they can afford to avoid headaches. Basically, Verizon and other U.S. wireless carriers adore making their plans intimidating and confusing because they know you'll pay a premium to avoid bullshit surprises and headaches in the middle of your billing cycle. They're effectively intentionally sowing confusion, then charging you a premium to avoid arbitrary penalties. Like the airlines, banking, and other industries, U.S. policymakers treat reining in this kind of behavior as a non-starter.

Which is why it was surprising that net neutrality rules, which mandated transparency and other base-level restrictions on this kind of stuff, managed to get passed in the first place. But not only did the Trump administration eliminate these hugely popular consumer protections based on bullshit data, they effectively lobotomized the agency's authority over telecom at lobbyist behest. Said lobotomized FCC then rubber stamped the T-Mobile Sprint merger (without even looking at the data or warnings by antitrust experts), ensuring less overall price competition over the next few years.

In short if you're an American who likes paying a lot for mediocre, spotty service delivered on a platter of intentionally confusing options designed to nickel-and-dime you into oblivion, things are looking good for you over the next 3-5 years. Enjoy!

Filed Under: fcc, truth in advertising, unlimited, wireless
Companies: verizon

AT&T Whines That The T-Mobile Merger Consolidated Too Much U.S. Spectrum In One Place

from the glass-houses dept

AT&T and Verizon didn't have much to say as T-Mobile was lobbying for Sprint merger approval. In large part because most of the downsides of the merger -- such as lower overall pay for sector employees -- or higher overall prices due to a consolidated lack of competition -- aided the two wireless giants.

Now that the deal's done, AT&T (no stranger to mindless consolidation and monopolization itself) is apparently concerned that the deal consolidated too much spectrum in the hands of one company. Namely, T-Mobile. From a FCC filing this week spotted by Ars Technica:

"The combination of Sprint and T-Mobile has resulted in an unprecedented concentration of spectrum in the hands of one carrier. In fact, the combined company exceeds the Commission's spectrum screen, often by a wide margin, in Cellular Market Areas representing 82 percent of the US population, including all major markets."

This is apparently part of a new trend at AT&T where it engages in bad faith critiques of U.S. policy despite decades engaging in the same or worse behavior (see AT&T's terrible take on Section 230, or its bad faith claim that it wants a real privacy law). In this case AT&T, a company that has benefited for decades from feeble U.S. restrictions on "spectrum squatting" (hoarding valuable wireless spectrum either for sale or simply so smaller competitors can't use it to hurt you), is now just super concerned about the practice when somebody else does it. From a companion blog post by the company:

"Given this unprecedented level of spectrum concentration in the hands of a single carrier, we have entered a new era for the FCC’s spectrum acquisition analytical tools. The Commission must now take action to reaffirm the importance of a spectrum aggregation tool and define a meaningful approach going forward."

Now that another company has abused feckless U.S. oversight to its own advantage, AT&T wants the FCC to do something. Whereas when AT&T, which dominated the wireless sector for the better part of the last two decades engaged in the same sort of hoarding, there was nothing to worry about.

The FCC does have a spectrum screen it uses to determine when accumulation of spectrum raises consolidation flags, but, like so much with U.S. telecom regulators, often isn't accompanied by substantive action. Especially if those triggering the flag happen to be politically-powerful telecom giants all but fused to the nation's intelligence-gathering apparatus. Given reports suggest the Trump FCC didn't even look at the data (or existing complaints about T-Mobile spectrum hoarding) before rubber stamping the T-Mobile merger, it shouldn't be surprising that policy inconsistencies got lost in the weeds.

Perhaps AT&T officials could come testify before Congress about the perils of mindless consolidation and regulatory capture?

Filed Under: competition, fcc, spectrum, wireless
Companies: at&t, t-mobile

Verizon Buys Tracfone As U.S. Wireless Gets Even More Consolidated

from the merge-ALL-the-things dept

As economists and experts had warned, the recent $26 billion Sprint T-Mobile merger effectively decimated the prepaid space. T-Mobile had already laid off around 6,000 employees at its Metro Prepaid division, with more layoffs expected. Many of the "mobile virtual network operators" that operated on Sprint's network now face an uncertain future, with growing resentment in the space among prepaid vendors, who say T-Mobile is already using its greater size and leverage to erode commissions and to renegotiate their contracts for the worse. Many prepaid vendors are calling for help that most certainly won't be coming any time soon from the Trump Federal Trade Commission (FTC) and Department of Justice’s Antitrust Division.

With that as backdrop, another major effort at wireless consolidation has emerged with Verizon's announced purchase of Tracfone, one of the biggest prepaid vendors in the U.S. The $6.2 billion deal will, Verizon insists, result in "exciting and compelling" products in the years to come:

Yes, if there's one word that American consumers have come to associate with major telecom mergers, it's "excitement."

The problem here, of course, is that the direct result of mindless M&A in the U.S. telecom space couldn't be any more apparent. Less overall competitors means less effort to seriously compete on price. And the MVNO space had already been under relentless assault by companies like Verizon that have slowly but surely done their best to elbow out any smaller players that dare seriously compete on price with the major networks they must rely on to survive.

With the postpaid market saturated, wireless players are now forced to eek out growth wherever possible. In this case, via acquisitions, followed by only a superficial continued dedication to prepaid wireless lower-priced offerings. As part of the Tracfone deal, Verizon not only nabs 21 million Tracfone customers, but the company's Net 10, Walmart FamilyMobile, SafeLink, Simple Mobile, Straight Talk Wireless, and Clearway prepaid brands as well.

Fewer major networks means less incentive than ever to negotiate on rates, roaming, or much of anything else. With Sprint (the most friendly company to MVNOs by a wide margin) now out of the picture, things have gotten more treacherous for smaller MVNOs than ever. Of course, if the U.S. stays close to its historical norm, in about five years U.S. wireless data (pre and postpaid alike) will be significantly higher, and everybody will be left standing around with a dumb look on their collective faces wondering what went wrong.

Filed Under: competition, mergers, mvnos, prepaid wireless, wireless
Companies: tracfone, verizon

Yet Another Study Shows U.S. 5G Over Promises, Under Delivers

from the unwarranted-hype dept

It was the technology that was supposed to change the world. According to carriers, not only was fifth-generation wireless (5G) supposed to bring about the "fourth industrial revolution," it was supposed to revolutionize everything from smart cities to cancer treatment. According to conspiracy theorists and internet imbeciles, 5G is responsible for everything from Covid-19 to your migraines.

Unfortunately for both sets of folks, data continues to indicate that 5G is nowhere near that interesting.

A number of recent studies have already shown that U.S. wireless isn't just the most expensive in the developed world, U.S. 5G is notably slower than most overseas deployments. That's thanks in large part to our failure to make so-called middle band spectrum available for public use, resulting in a heavy smattering of lower band spectrum (good signal reach but slow speeds) or high-band and millimeter wave spectrum (great speeds, but poor reach and poor reception indoors). The end result is a far cry from what carriers had spent the last three years promising.

PC Magazine was the latest to put carrier promises to the test and came away decidedly unimpressed. Networks certainly are getting faster, the report concludes, but it's largely due to steady evolutionary improvements being made to 4G networks, not newer 5G networks. As such, PC Magazine is forced to admit they bought into early carrier hype promising an amazing revolution:

"We admit it, we bought into the 5G hype. Carriers, phone makers, and chip makers alike have all been selling 5G as faster and more powerful than 4G, with lower latency. So I was shocked to see that our AT&T 5G results, especially, were slower than 4G results on the same network. This is a crisis for marketing, not for performance. All three US carriers showed significantly higher download speeds and better broadband reliability than they did in our 2019 tests. It's just that these gains, particularly on AT&T, are largely because of improvements in 4G, not 5G networks."

Wireless carriers haven't given much thought to the perils of over-hyping 5G, thereby associating the standard with empty bluster and frustration in the minds of consumers. You'll recall that AT&T has lied repeatedly in trying to pretend that 4G is 5G via misleading phone icons, and Verizon perpetually enjoyed hyping 5G market launches, only to have those looking for an actual 5G signal find that availability is these markets is spotty... at best (one study found that a Verizon 5G signal was available around 0.4% of the time in launched 5G markets).

Not too surprisingly then, PC Magazine routinely found it difficult to actually obtain a 5G signal:

"It's been more than a year since the US carriers launched 5G. AT&T purports to have 5G in 22 of our 26 test cities; Verizon has it in 18; and T-Mobile has it in all of them. But our 5G results were disappointing all around, on every carrier. Often, it was a choice between faux G (we’ll explain this shortly) and no G...most of our current 5G coverage offers people a slightly improved 4G experience dressed up with a shiny new icon. That’s not bad, but to live up to their lofty promises about how 5G will change education, medicine, industry, and home internet, the carriers will need to use more spectrum and better technology than they’re currently giving us.

It's also worth noting that despite all the promises surrounding the T-Mobile and Sprint merger, the initial result has been slower speeds overall as the companies work to integrate discordant networks:

"So far, T-Mobile's absorption of Sprint hasn't shown much advantage for consumers. It's to the contrary, really: In our results, it looks like the rush of Sprint users onto T-Mobile's network has created some congestion that has caused T-Mobile to fall behind in comparative performance. All of the carriers' speeds increased from 2019 to 2020, but T-Mobile's increased less than AT&T's and Verizon's did."

PC Mag's study was mirrored this week by a Washington Post investigation that basically concluded all the same things. Namely that 5G isn't much to write home about, and in many instances U.S. 4G networks outperform 5G in 5G launch markets:

"Your experience with a 5G phone in 2020 is likely to be all over the map. I got searing fast 750 Mbps downloads from AT&T in one corner of downtown. But in the same spot, my 4G phone got an also extremely fast 330 Mbps. Moreover, because of the pandemic, those aren’t places I go very often. As I write this from my home office in the middle of San Francisco, I’m getting 11 Mbps downloads on my AT&T 5G phone. On T-Mobile, I get a laughable 8 Mbps on 5G, which is barely enough to stream HD Netflix."

I regret to inform you that despite a lot of tech policy bluster and carrier marketing, we are most assuredly not winning the "race to 5G." In fact, our broadband maps are so routinely terrible, I'm not sure we'd be able to confirm it if we were.

Again, 5G will certainly offer faster speeds, lower latency, and more reliable networks over the long haul, especially as carriers push new middle band spectrum to market. Even then, don't expect 5G pricing to be particularly innovative thanks to the death of net neutrality and reduced competition due to consolidation. Carriers are also lobbying the FCC to exclude 5G from broadband mapping improvements (meaning don't expect an accurate read on where it's truly available any time soon). The more things change...

Filed Under: 5g, overpromise, wireless
Companies: at&t, verizon

Yet Another Study Shows U.S. 5G Is Far Slower Than Many Other Nations

from the not-the-revolution-we-were-promised dept

Last May, a largely overlooked report by OpenSignal detailed how, despite endless hype, U.S. 5G is notably slower than 5G in most other developed countries. Because U.S. regulators failed to make mid-band spectrum (which offers faster speeds at greater range) widely available, many U.S. wireless carriers like Verizon embraced higher millimeter wave spectrum (which has trouble with range and building wall penetration) or low-band spectrum (which offers greater range but at notably reduced speeds). The result of the study was fairly obvious:

A new updated report by OpenSignal didn't have any better news. According to the wireless network analysis firm, average 5G download speeds in the US is somewhere around 50 Mbps. And while that's certainly nothing to sneeze at, it's a far cry from carrier hype proclaiming 5G is somehow utterly revolutionary, and it's far from the 200-400 Mbps speeds being seen in many other countries:

"When we consider the average download speed using 5G technology we see a very different story. While Saudi Arabia remains in first place, South Korea jumps to second place with average 5G Download speeds of a staggering 312.7 Mbps — over five times faster than South Korea’s already fast 4G speeds. The U.K. moves up the rankings with the U.S., Netherlands and Germany now dropping into the last three positions."

To be clear the U.S. is taking steps toward fixing the problem. The FCC just completed a major auction of mid-band spectrum, though confidentiality means we don't yet know who the winners of the auction were. It's also worth noting that because of the heavy use of low-band spectrum in the U.S. (again, offering slower speeds but at better range), U.S. 5G signal availability and reliability (assuming you've in a launch market and were able to afford a new phone that supports it) has been pretty good, even if our implementation of 5G isn't as fast as many other nations.

The problem is that while 5G is somewhat faster than 4G in the States, a modest evolution is not what's being advertised to the end user. Companies like Verizon advertise 5G as a near-mystical panacea that's capable of revolutionizing everything from smart cities to cancer treatment, even though a closer examination usually shows that's simply not true. Carriers have also been repeatedly misleading the public about where 5G is actually available, which is associating the standard with empty hype in the minds of consumers.

The other problem that will plague the U.S. (but gets largely ignored by firms employed by wireless carriers who don't want the subject talked about) is the cost of 5G in the States. Americans already pay some of the highest prices for 4G in the developed world, and with the triple punch of captured regulators, the death of net neutrality rules (which prohibited non-transparent "creative" nickel-and-diming of users) and an almost mindless lust for competition and job-eroding industry consolidation, Americans will once again wind up paying higher prices for slower service than most developed nations.

That's all a long way of saying that for a country that prattles on endlessly about the importance of the "race to 5G," we're a far cry from ever being able to claim we're actually winning it.

Filed Under: 5g, fcc, mid-band, race to 5g, us, wireless
Companies: verizon

Wireless Carriers Once Again Fight Efforts At More Accurate Wireless Availability Maps

from the you-can't-fix-what-you-don't-understand dept

If you live in a rural area, or have driven across the country anytime in the last five years, you probably already know the telecom industry's wireless coverage maps are misleading -- at best. In turn, the data they deliver to the FCC is also highly suspect. Regardless, this is the data being used when we shape policy and determine which areas get broadband subsidies, and, despite some notable progress in improving this data in recent years, it's still a major problem. Last year, for example, the Trump FCC quietly buried a report showing how major wireless carriers routinely overstate wireless voice and data availability.

Facing massive political pressure from pissed off (and bipartisan) state lawmakers eager for a bigger slice of federal subsidies, the FCC has started taking the basic steps necessary to start to improve things. One of those improvements is a recent proposal (pdf) that would include requiring carriers actually drive around testing their network performance so they can provide more accurate, real-world data. This isn't a huge ask. But T-Mobile and AT&T are fighting back against the proposal, claiming it's "too expensive":

"With respect to cost, AT&T estimates that to drive test just 25 percent of the square kilometers of its nationwide 4G LTE coverage would cost approximately $45 million each year and that drive testing only 10 percent of its coverage would still cost as much as $18 million/year. Requiring that all carriers conduct such nationwide drive tests, especially on a regular basis, is simply too costly especially at a time when investment in 5G deployment is a top national priority. The [FCC order] proposes to use a statistically valid sample where carriers would be expected to conduct a certain amount of drive tests "that is statistically appropriate for the area tested." However, there is no indication of how an "area" would be defined, which makes it difficult to assess the feasibility of developing a sample."

This is, you're supposed to forget, the same AT&T that just received a $42 billion tax break from the Trump administration. This tax break was supposed to "fuel investment" and "create jobs"; instead AT&T has fired 41,000 employees since the 2017 tax cuts, and trimmed its overall 2020 CAPEX by around $3 billion. Killing net neutrality and other regulatory favors doled out billions more to these companies. Now, after four years of ceaseless taxpayer handouts, AT&T is claiming it's "too expensive" to do basic drive-by confirmation of data reliability.

AT&T wants the FCC to rely on tower data because it's easier and cheaper to collect. But regulators in both California (pdf) and Vermont have found that you can only really get accurate data from actual driving measurement programs. Small carriers have also noted that such drive tests are the only way to prove major carriers are lying about coverage. One guess on which side of the aisle the captured Ajit Pai FCC is going to come down on? Especially given it's in Pai's and the industry's best interests to portray his "hands off, deregulatory agenda" (read: mindlessly pandering to the telecom industry's biggest companies) as an incredible success?

The broadband industry has long lobbied against better broadband maps, knowing that better data will only highlight the scope of the U.S.' broadband competition and coverage problems. More recently, the industry attempted to lobby the FCC to exclude 5G from any wireless mapping improvements. Again, the motivation here is obvious. Were we to actually grasp the full failure of the telecom sector in terms of coverage, competition, and price... (especially during a health crisis that's advertising broadband as an essential utility) somebody might just get the crazy idea to actually do something about it.

Filed Under: broadband, broadband access, data, fcc, maps, mobile access, rural
Companies: at&t, t-mobile

Verizon Forced To Back Off Charging Extra For 5G

from the overhyped dept

While fifth-generation (5G) wireless will result in faster, more resilient networks (once it's finally deployed at scale years from now), the technology has been over-hyped to an almost comical degree. Yes, faster, lower latency networks are a good thing, but 5G is not as paradigm-rattling as most wireless carriers and hardware vendors have led many in the press to believe. 5G is more of a useful evolution than a revolution, but it has become the equivalent of magic pixie dust in tech policy circles, wherein if you simply say "it will lead to faster deployment of 5G!" you'll immediately add gravitas to your otherwise underwhelming K Street policy pitch.

Here on planet Earth, most consumers couldn't care less about 5G. In most surveys U.S. consumers -- who pay some of the highest prices in the world for mobile data -- say their top priority is usually lower prices. That's increasingly true during a pandemic and economic crisis, where every dollar counts.

Enter Verizon, which, instead of reading the market, has been repeatedly trying to charge $10 extra for 5G despite consumers not seeing the value. Verizon executives had fooled themselves into thinking a "premium" upgrade warranted a premium price tag. But consumers quickly realized the extra money simply wasn't worth it. For one, Verizon's network is barely available (one study stated a full 5G signal was available about 0.4% of the time). First generation 5G devices are also expensive and tend to suffer from crappier battery life. All for admittedly faster speeds most users don't think they need yet.

With consumers not really that interested, and no other wireless carriers attempting to charge extra anyway, Verizon has been forced to finally back away from the $10 monthly surcharge after flirting with it since last year:

"The collapse of Verizon's attempt to charge extra for 5G doesn't come as much of a surprise. No other provider in the US – including Verizon's own MVNO partners – is charging extra for 5G.

However, the development has significant implications for the 5G sector in general because it means operators cannot make any extra money from 5G when selling it for consumers' smartphones, despite the money they're plowing into deploying the technology.

Granted that's not really true. With the FCC having recently dismantled itself at lobbyist behest (including the demolition of net neutrality rules), there's not a whole lot keeping Verizon from nickel-and-diming U.S. wireless consumers in a wide variety of creative ways. The company already sells "unlimited" data plans that prohibit HD and 4K unless you pay more, so the precedent has been set and the door is open wide to a variety of spurious new surcharges.

That's particularly true given that captured U.S. regulators in the Trump administration keep signing off on terrible mergers that are guaranteed to reduce competition and raise rates. So while Verizon has struggled to extract its pound of flesh via an additional 5G surcharge, they'll surely come up with some ingenious new fees down the road. And U.S. regulators and Congress, by and large, will not only be fine with that, but they'll help Verizon pretend it's the pinnacle of innovation. After all, we wouldn't want to lose the "race to 5G," right?

Update: and like that Verizon appears to have found another way to charge users more, by making 5G only something you can get if you subscribe to one of the company's (not actually) unlimited data plans. Funny how that works.

Filed Under: 5g, competition, surcharges
Companies: verizon

Dish Buys Ting Mobile To Disrupt Wireless, But Questions Remain

from the steep-uphill-climb dept

We've noted repeatedly that not only did the Trump FCC and DOJ rubber stamp the controversial T-Mobile and Sprint merger, they willfully ignored data showing the deal would result in high prices, lower overall sector pay, fewer jobs, and less overall competition. As most objective antitrust and telecom experts predicted, the ink was barely dry on the deal before the pink slips started to arrive. The higher rates will still likely take a few more years to materialize as the remaining three industry players (T-Mobile, AT&T, and Verizon) perfect their ability to pretend to compete on price without actually doing so.

Over at the DOJ, top "antitrust enforcer" Makan Delrahim not only ignored hard data and critics of the deal, he actively helped guide T-Mobile executives to deal completion (if you're unaware, folks tasked with leading the governments antitrust enforcement efforts most assuredly should not be doing that).

To try and justify this grotesque regulatory capture, the DOJ came up with a bad idea: it would require T-Mobile offload some spectrum and its Boost Mobile prepaid brand to Dish Network, which would then, theoretically, try and build a replacement carrier for Sprint over a period of 7 years. For much of that time Dish will simply operate as a glorified MVNO (mobile virtual network operator) on T-Mobile's network and be subject to T-Mobile whims.

The problem: Dish has a long history of hoarding valuable spectrum and promising to build a wireless network and then, you know, not doing that (just ask pre-merger T-Mobile). The other problem: shepherding such a deal to completion requires the current FCC (rabidly proud of "hands off," "light touch" regulation) to aggressively nanny this deal to completion, something that simply isn't in Ajit Pai's ideological nature. The remaining three players in the space (T-Mobile, AT&T, Verizon) have every motivation to try and scuttle the creation of this fourth competitor to avoid having to actually (gasp) compete on price.

Throughout, there have been questions about just how serious Dish is. Again, the company has a long history of buying up valuable spectrum and then doing absolutely nothing with it. Dish's spectrum holdings are extremely valuable, and critics have long wondered if the company is just stringing feckless U.S. regulators along until it can sell its spectrum at a steep premium.

Whether Dish is serious still isn't really a settled question, but the company continues to give every impression it may genuinely want to disrupt wireless as a survival strategy in the wake of its struggling traditional TV business. That manifested this week in the acquisition of Tucows' Ting, a small MVNO that had been making slow inroads as a minor player in the wireless space. In a blog post, Ting insists that nothing will really change at the small operation now that it has been acquired by a major corporation engaged in (hopefully) a massive disruption play:

"DISH enters the mobile market with a well-established, well-loved brand in Ting Mobile, a wonderful customer base in you and a proven platform on which to build its mobile service. It also gets a strong, smart partner (if we do say so ourselves) to support its mobile business moving forward. As for DISH’s big plans in mobile, much has been written on that topic. We’re happy to be a part of these plans.

From the sounds of things this isn't a full acquisition of all Ting assets (Ting's fiber efforts will not be part of the deal). Users in the comments of the blog post were skeptical that selling a small upstart with a focus on consumers to a giant satellite TV company with a long history of obnoxious executive leadership won't result in some obvious changes:

"I will say I'm disappointed and incredibly wary. Ting is a brand I have high confidence in. Dish is a brand I have zero confidence in. "Nothing changes today." But changes will come. Sadly, I will not be surprised if I find myself shopping for a new provider once they start."

Maybe this all ends with Dish Network shifting from the dying satellite TV sector and becoming a major rival to AT&T and Verizon, but I remain wary. AT&T and Verizon play dirty pool in the DC lobbying realm, and both will do absolutely everything in their power to disrupt the creation of a viable fourth replacement price competitor. And if Trump is re-elected, his "light touch" (read: utterly apathetic to all consumer issues, competitive problems, and price gouging) FCC simply lacks the backbone or ideological motivation to hold any of these companies seriously accountable should their promises wind up being little more than hot air.

Pre-merger promises in the U.S. telecom sector simply don't have a great track record, and I remain skeptical that this wasn't just a regulatory stage play by the Barr DOJ to help justify apathy toward reduced competition, resulting in Dish profitably cashing out of its spectrum holdings a few years from now. And while it's certainly possible Dish can become a major replacement fourth competitor for Sprint, it's the sort of thing you should probably believe only once you've seen it accomplished.

Filed Under: broadband, competition, mvno, wireless
Companies: dish, ting, tucows