During last week’s Virtual Investor Day, Verizon explained how the 161 megahertz of spectrum it purchased in the C band auction for $52.9 billion will fit into its overall 5G spectrum profile and the carrier’s continued millimeter wave (mmWave) buildout.
Hans Vestberg, Verizon Communications chairman and CEO, said. “We have an unparalleled opportunity to shape and monetize the next chapter of growth built on the 21st century’s infrastructure: mobility, broadband and cloud.”
The carrier won a minimum of 140 megahertz of total bandwidth in the contiguous United States and an average of 161 megahertz nationwide in 406 markets in all, which doubled its existing mid-band spectrum holdings. Specifically, 60 megahertz of spectrum in the initial 46 markets is targeted for use by the end of 2021, if it is cleared of the satellite providers that currently use the band.
Additionally, Verizon won up to 200 megahertz in 158 mostly rural markets covering nearly 40 million POPs. “This [spectrum] will further enhance our broadband solution portfolio for rural America,” said Kyle Malady, Verizon Communications chief technology officer.
“The licenses are contiguous. Much like 700 MHz at the dawn of LTE, this is beachfront property,” he added. “And we will license the spectrum outright. We’re not leasing it, and our rights extend from coast to coast without gaps.”
Verizon’s spectrum winnings in the C-band auction increase its spectrum holdings in the sub-6 gigahertz band by 120 percent.
“We now have a very competitive position in low and mid-band to go along with our leading level of mmWave holdings,” Malady said.
C Band, mmWave Buildout Timetable
Through 2022 and 2023, Verizon plans to increase its C band coverage to more than 175 million POPs in 46 markets. And when the remaining C band is cleared, it will increase coverage to more than 250 million POPs in 2024 and beyond.
“We’ve been planning for this for many, many months and are already working with our equipment and infrastructure partners to make this the fastest deployment of new spectrum ever,” Malady said.
Verizon will continue to expand its mmWave footprint, which ended last year with more than 17,000 sites. Malady said he expects to build another 14,000 sites in 2021 and more after that.
“At least 5 percent of Verizon’s overall network usage is expected on mmWave transmitters by the end of the year,” Malady said. “This could increase to 10 percent, depending on how quickly we emerge from the pandemic and return to stadiums and venues.” As much as 50 percent of urban usage could move to mmWave in some of the densest markets, he added.
C band Spectrum will Aid Network-as-a-Service Strategy
Verizon acquired the C-band spectrum because it fits with its network-as-a-service strategy, according to Vestberg. In 2020, Verizon announced its intention to design an enhanced customer experience for more than 9,000 Walgreens and Duane Reade retail locations nationwide.
“What C-band does is significantly enhance our ability to go after and monetize the immediate opportunities we have in 5G mobility, fixed wireless access, both in the home and office, and the mobile edge compute, in particular,” Vestberg said.
Verizon will increase its capex by $10 billion over the next three years to put the C-band spectrum into use, which will begin with up to 8,000 tower sites in 2021. After that, the carrier’s capex will decrease.
“We are ready to go as soon as the first local spectrum is cleared for use later this year,” Vestberg said. “We are deploying these new assets on our Intelligent Edge Network. This means we can leverage our fiber infrastructure and cost advantage for decades to come.”
In the last year, Verizon has added 500 megahertz of bandwidth in the 37 to 39 GHz bands, in addition to adding 40 megahertz of unlicensed Citizens Broadband Radio Service spectrum by adding up to 40 megahertz of priority access licenses.
One third of Verizon’s 4G and 5G cell sites are serviced by its fiber today, and it plans to increase that number to more than 50 percent in the next three years. The carrier’s fiber build program, which spans more than 60 markets outside of its local exchange carrier footprint, will facilitate that effort.