August 4, 2016 — Verizon Wireless (VZW) showed steady growth and continued network expansion through the first six months of 2016. The company is sustaining its network expansion program. Already touting the largest national network in terms of area coverage, VZW will be the big spender among the national carriers in 2016. Much of that investment is for advanced 4G LTE wireless technology, what VZW calls XLTE, effectively doubling the bandwidth available to its customers.
VZW’s 2016 wireless capital expenditures (capex) are estimated $11 billion, down 6 percent from $11.725 billion spent in 2015. Wireless accounts for roughly two-thirds of the total $17.2-17.5 billion 2016 capex guidance that Verizon provided at year-end 2015.
Wireless capex in 2Q16 came in at $2.8 billion, up 29 percent over $2.2 billion spent in 1Q. The slow start in 1Q16 was the result of a combination of severe winter weather, particularly in the Northeast, and an extended labor strike.
The $5 billion spent in the first six months is 45 percent of VZW’s projected full-year spending. The 1Q slow start is not unusual although 2016 level is below prior years. Still, the company will close the gap throughout the year.
VZW offered details on where it is investing in its network. Of the total wireless capex, nearly half goes into the radio access network (RAN) portion. RAN includes the radios and ancillary equipment needed to provide cellular RF connections to wireless devices. RAN equipment comprises different types of RF systems.
VZW installed more than 1,500 new macrocell sites and added XLTE technology to another 1,700 existing macrocells across the country from January to July. The company points out that these sites are needed to handle exponential mobile data demand growth while providing customers with highly-reliable connections.
Of important note, VZW is in the early stages of deploying tens of thousands of small cells to increase network density. With Crown Castle as its systems integrator, VZW is installing small cells consisting of a radio, antenna, power and a fiber connection. Operating within VZW’s existing network coverage area, small cells are strategically-positioned along busy streets to provide additional 4G LTE capacity in high-traffic urban and suburban areas.
DAS provides indoor cellular coverage in large, high-traffic venues (stadiums, convention centers, office buildings, train stations, airline terminals), and dense, outdoor urban areas.
John Celentano is a principal in Skyline Marketing Group, which provides technology marketing & sales strategy advisory in advanced communications services, and wireless, telecom, data networking infrastructure markets. The firm also develops client-specific print and digital marketing campaigns with customer-focused vectors (media articles, white papers, application notes, emails, advertising, webinars, trade show/conferences, web content, videos, SEO, blogs, public speaking, press releases). Additionally, support is provided for internal positions in market analysis, business development, strategic planning, strategic marketing, product management, product marketing, sales operations.
For more information, go to https://www.linkedin.com/in/john-celentano-4822692
The wireless industry buzz around 5G is a big deal.
5G is the next-generation wireless access technology. As such, it has significant implications for future wireless networks involving the carriers that operate them, the manufacturers that supply the active and passive gear to enable 5G, and those companies that build and maintain the infrastructure that supports it.
The Promise of 5G
Describing 5G and the significant advances it makes over current 4G technology is complex. Rather, it is better to appreciate what 5G capabilities will deliver, and not get too concerned with how it does it.
To wit, 5G promises an order of magnitude in performance over today’s 4G. That performance includes: download speeds in the gigabit per second (Gbps) range compared to less than 100 Mbps today; very low latency, or delay, something around one millisecond (or less); channel bandwidth of at least 100 megahertz; and, duplex operation.
5G networks will be used in consumer and commercial applications alike for ultra high-definition (HD) video, any-to-any device in the Internet of Things (IoT), connected vehicles and homes, telemedicine, virtual reality, remote control of industrial sites, and wearables.
All these developments are feasible but 5G commercial availability will take time. The timeline for widespread deployment is projected at 2020 and beyond.
That is not to say that testing has not already begun.
A number of announcements at this year’s Mobile World Congress in Barcelona, Spain hint at the power of 5G that is in the works. For instance, Nokia is collaborating with Verizon Wireless on a 5G field trial in Dallas-Fort Worth, Texas delivering Ultra HD (4K) video. Nokia’s Bell Labs has demonstrated peak wireless data speeds of more than 30 Gbps to an end user, and more than one million simultaneous connections in a single cell. As well, Nokia launched a cloud-based radio access network (RAN) that supports multiple wireless access technologies from legacy 2G to today’s 4G LTE and carrier-grade Wi-Fi. It is 5G-ready, as well.
The CapEx Imperative
Two key factors drive wireless carrier capital expenditures: 1) the number of devices that connect to the network, and 2) the usage that each device generates.
In the United States, many of us use several wireless devices whether one or more smartphones, a tablet, and a laptop. Today, there are more wireless devices than people. When we factor in the projections for machine-to-machine (M2M) and IoT sensors, then the number of devices grows exponentially into the billions.
Usage per device is growing at exponential rates, as well, mainly driven by data-rich mobile apps and streaming video. Individual data usage now averages well into the gigabits per month range.
When number of devices is multiplied by the usage per device, we quickly find that capacity demand on the network is also growing at exponential rates. (Exhibit 1)
For the carriers to keep up with demand, they must sustain a commensurate capital expenditure (capex) program to expand network capacity. This means increasing the density of their networks by locating radios and antennas closer to customers to deliver the Gbps speeds. Not doing so means falling behind the technology curve, and ultimately losing customers and revenues.
From a manufacturer’s perspective, Moore’s Law economics allows for development of compact radios that can be moved closer to the users away from macrocells and down to nodes, access, points and endpoints which leads to greater network densification. (Exhibit 2)
With the added capacity in a single connection, carriers can begin to realize a payoff by tapping into revenue flows that were previously unattainable, namely Ultra HD video on the high end, and M2M/IoT communications on the low end along with current voice, text and data.
Demand for Skilled Wireless Technicians
What does the emerging technology of the future mean to today’s tower service companies?
The deployment and maintenance of 5G technology will bring plenty of work above ground level (AGL) and even more so, close to or at ground level work.
The demand for skilled cell site installers and testers for all sizes of cell sites can only grow as the number of site deployments expands.
Every site requires radios, antennas and backhaul, much of which will be with fiber cable. Regardless of size, there is still the need to test for RF performance, optical transmission and passive intermodulation (PIM) interference.
Future tower climbers will be needed as much for their technical skills in optimizing RF and optical performance and data networking as for their climbing skills.
In the end, 5G is all about high-speed connectivity. Technical skills to install and test these new systems will be in demand regardless of the antenna height. The skill set is the same.