Verizon shifts 5G buildout from coverage to satisfaction, revenue

Verizon's top executive said that, starting last year, the company shifted its midband 5G network buildout strategy from a coverage play to one that will emphasize customer satisfaction and revenues.

"We already have changed our strategy in '23, so the deployment of our C-band [midband spectrum] is based on customer satisfaction and on revenue generation," Verizon CEO Hans Vestberg said Monday at an investor event. "Even though we're going to cover almost all the population [with C-band], that is not the main driver and the priority right now."

Vestberg explained that Verizon set aside $10 billion in 2021 for a three-year project to upgrade its network to 5G technology using its new midband C-band spectrum holdings. That initial project focused on covering as many people as possible, primarily by installing 5G C-band radios in densely populated urban areas.

Today, though, that program is over, so now Verizon is installing C-band radios in locations where it can improve its customer satisfaction rates, or where it can generate more revenues through services like fixed wireless.

"Right now our deployment is much more about getting it to where we need better customer satisfaction. It might be densification, or people have moved to a certain area, or how do we create even quicker revenue from our investment," Vestberg said.

Vestberg added that, in markets where Verizon offers C-band connections, the operator sees a greater portion of customers selecting its more expensive service plans than in markets where it doesn't offer C-band. He said Verizon also generates more gross customer additions in such markets and counts fewer customer defections.

"The user experience on C-band is way, way better," he said.

T-Mobile officials recently disclosed a similar 5G network buildout strategy. T-Mobile's networking chief Ulf Ewaldsson said in October the operator now uses AI technology and billions of data points to determine exactly how and where to upgrade and expand its network. Company representatives call the effort "customer-driven coverage."

Expanding and improving

Verizon spent more than $50 billion to acquire nationwide C-band spectrum in an FCC auction in 2021. It also paid satellite operators like SES and Intelsat, which previously used that spectrum, to get access to those licenses more quickly.

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