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US—a who’s who of the U.S. wireless industry—faced a virtual crowd of investors at the Goldman Sachs Communacopia conference this past week. All were focused on 5G, but came at the shift to next-generation networks in different ways.
On Tuesday, Verizon CEO Hans Vestberg described his company’s strategy as providing “network as a service.” Verizon (ticker: VZ) announced a nearly $7 billion deal for prepaid mobile virtual network operator TracFone Wireless on Monday, aimed at expanding its share in the market’s lower end. About 13 million of TracFone’s 21 million customers already connect to Verizon’s network, and Vestberg said the network has enough capacity for the remainder.
Vestberg explained how his company plans to monetize 5G by nudging customers to higher-priced monthly plans. More than half of Verizon’s accounts are already on unlimited data plans, but only the top-tier plans include 5G access. Verizon is also in the early stages of offering a 5G home-broadband product in certain markets, using the same network as mobile 5G.
AT&T (T) CEO John Stankey, who also spoke on Tuesday, focused on the benefits of the company’s media and telecom portfolio approach—while also hinting at possible divestitures of noncore assets in the future. He pointed to investments in new HBO Max content and fiber-optic cable to power 5G infrastructure and home-broadband service.
He explained how HBO Max can capture viewers canceling DirecTV and attract customers to more-expensive wireless and other telecom plans that bundle the service. That could also serve to keep customers from switching providers.
Stankey reiterated AT&T’s commitment to its dividend, currently yielding 7.1% annually, and to paying down debt.
On Wednesday, T-Mobile (TMUS) CEO Mike Sievert underlined the wireless spectrum benefits of the just-completed acquisition of Sprint and the efficiencies of scale that will allow the company to keep its prices low relative to Verizon and AT&T. T-Mobile’s overall message might be summed up as: “We think we’re building the best 5G network ever and our competitors won’t know what hit them.”
Wall Street doesn’t disagree. T-Mobile has the most Buy ratings of the wireless companies, and has handily outperformed Verizon and AT&T in 2020.
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Cellco Partnership, Inc., T-Mobile US, 5G, Mobile phone, Verizon Communications, Apple, AT&T Mobility
World news – CA – The Race Is on to Win the 5G Battle. T-Mobile Has the Lead.