CHTR - Charter Communications

[glorysk87]

I was responding to your original comment, which was:

 

Its limited cities right now but they want 100 mn 0eople covered in the next year or two (which is most of the major cities).

 

Dunno why you're now pointing out the 2025 number. But ok.

[LearningMachine]

I was responding to your original comment, which was:

 

Its limited cities right now but they want 100 mn 0eople covered in the next year or two (which is most of the major cities).

 

Dunno why you're now pointing out the 2025 number. But ok.

 

I think you're mixing up dwy000's and my responses.  I never mentioned 100 million covered in the next year or two.

[vince]

They're targeting 1 to 2mm people by year end, and 15mm is their target for full coverage. Not sure where you're getting 100mm from.

They are planning 50 Million coverage by 2025.  Please see https://www.verizon.com/about/sites/default/files/Verizon-Investor-Day-Infographic-2021.pdf

 

Higher reliability? Absolutely no chance, just based on the physics. Speed, maybe, but a move to Docsis 4 and beyond can bring the cable plant up to 5G FWB speeds.

I disagree that the probability is 0%.  Reliability includes network congestion issues when your colleagues on cable internet are running into network issues.  During WFH, if you work with a few hundred folks, you will start hearing how many run into network issues with cable internet.

 

If you have worked with carriers and cable internet providers on taking network equipment & devices, you will realize how high of a bar Verizon has for its vendors compared to other carrier and cable internet providers. To get there, it takes culture to be focused on reliability and be willing to say NO to vendors until they pass the stricter quality tests than any of their competitors.

 

You can search for 3rd party independent test results as well.  There is a reason businesses caring about network quality for their business choose to work with Verizon over Comcast, Charter, T-Mobile & AT&T.

 

I'm a little confused.  You post a link that says its for broadband and then different numbers than the original post.  In addition, the second set of numbers includes 4G wireless broadband.  Lastly, even if you assume it's not zero probability, it might as well be.  And that goes for reliability, speed, and total capacity available per user.  There is virtually no chance that ANY WIRELESS broadband service (across a large swath of their footprints) will match the speeds (down) that cable offers now, let alone what cable will have in 3-5 years (up and down).  And there is even less chance that wireless broadband users will be able to even come close to gigs used per month (cable averages are around 400-500 (climbing 30% a year) and wireless is like 10-15) no matter what they say about their increased capacity from 5G.  Now this may still turn out to be a decent business for Verizon because there is still lots of rural dwellings without access to 10-15 mbps and their broadband is piggybacking on their mobile investment.  They will also no doubt pick up some traditional cable/fiber broadband users.  However, it does not look like a threat to cable and may actually be a net positive

[vince]

I like Verizon at these prices and I like their prospects with their 5G investments. 

[LearningMachine]

They're targeting 1 to 2mm people by year end, and 15mm is their target for full coverage. Not sure where you're getting 100mm from.

They are planning 50 Million coverage by 2025.  Please see https://www.verizon.com/about/sites/default/files/Verizon-Investor-Day-Infographic-2021.pdf

 

Higher reliability? Absolutely no chance, just based on the physics. Speed, maybe, but a move to Docsis 4 and beyond can bring the cable plant up to 5G FWB speeds.

I disagree that the probability is 0%.  Reliability includes network congestion issues when your colleagues on cable internet are running into network issues.  During WFH, if you work with a few hundred folks, you will start hearing how many run into network issues with cable internet.

 

If you have worked with carriers and cable internet providers on taking network equipment & devices, you will realize how high of a bar Verizon has for its vendors compared to other carrier and cable internet providers. To get there, it takes culture to be focused on reliability and be willing to say NO to vendors until they pass the stricter quality tests than any of their competitors.

 

You can search for 3rd party independent test results as well.  There is a reason businesses caring about network quality for their business choose to work with Verizon over Comcast, Charter, T-Mobile & AT&T.

 

I'm a little confused.  You post a link that says its for broadband and then different numbers than the original post.  In addition, the second set of numbers includes 4G wireless broadband.  Lastly, even if you assume it's not zero probability, it might as well be.  And that goes for reliability, speed, and total capacity available per user.  There is virtually no chance that ANY WIRELESS broadband service (across a large swath of their footprints) will match the speeds (down) that cable offers now, let alone what cable will have in 3-5 years (up and down).  And there is even less chance that wireless broadband users will be able to even come close to gigs used per month (cable averages are around 400-500 (climbing 30% a year) and wireless is like 10-15) no matter what they say about their increased capacity from 5G.  Now this may still turn out to be a decent business for Verizon because there is still lots of rural dwellings without access to 10-15 mbps and their broadband is piggybacking on their mobile investment.  They will also no doubt pick up some traditional cable/fiber broadband users.  However, it does not look like a threat to cable and may actually be a net positive

 

Looks, like you're mixing up posts from dwy000 and me.  I never mentioned different figures.

 

Verizon 5G Home is actually seeing 20+GB per day usage.  Please see slide 38 at https://www.verizon.com/about/sites/default/files/2020-11/Verizon_Nov11_Analyst_Meeting.pdf. 

 

I understand some folks can make predictions like "no chance".  All the power to you.  I cannot make such strong predictions, but I'd say there is higher than 50-70% probability that Verizon 5G high band will be able to deliver higher speeds and higher reliability than cable internet, and they will ensure to have strict quality bar on their vendors to pass tests in different weather conditions, and they will continue to monitor their network capacity and quality issues and jump on them before their customers even notice them, unlike cable companies.  In the iphone launch, Apple stood by with Verion's claims that they are getting 4.0Gbps on Verizon high band, backing it up with Apple's own brand: https://www.youtube.com/watch?v=KR0g-1hnQPA.  I understand that is high band, and it will be lower than that for mid-band.  If memory serves right, I believe Verizon is only claiming 1+ gigabit per second for 5G nationwide home internet  - it is somewhere in the videos and links - don't have the link handy for that.

 

 

 

 

[vince]

you didnt post those numbers but when i posted that the original figures were wireless and not broadband, you responded that they were broadband.  So no, I dont believe I am mixing up posts.  And Im not going to address the rest of your post except to say that I think you might want to do some deeper research (including statements made by all 3 telecoms) before you put out those kinds of probabilities. 

[LearningMachine]

I think you might want to do some deeper research (including statements made by all 3 telecoms) before you put out those kinds of probabilities.

 

Thanks for the tip.  I actually did do that.  I've also consulted someone who still works in the telecom industry and is involved in this in Canada, and learning from telecom experiences in the U.S..  I'm also speaking from my experience of having to pass Verizon's much stricter quality bar and other telecoms' lower quality bars. It is well-known within the telecom industry.

[KJP]

They're targeting 1 to 2mm people by year end, and 15mm is their target for full coverage. Not sure where you're getting 100mm from.

They are planning 50 Million coverage by 2025.  Please see https://www.verizon.com/about/sites/default/files/Verizon-Investor-Day-Infographic-2021.pdf

 

Higher reliability? Absolutely no chance, just based on the physics. Speed, maybe, but a move to Docsis 4 and beyond can bring the cable plant up to 5G FWB speeds.

I disagree that the probability is 0%.  Reliability includes network congestion issues when your colleagues on cable internet are running into network issues.  During WFH, if you work with a few hundred folks, you will start hearing how many run into network issues with cable internet.

 

If you have worked with carriers and cable internet providers on taking network equipment & devices, you will realize how high of a bar Verizon has for its vendors compared to other carrier and cable internet providers. To get there, it takes culture to be focused on reliability and be willing to say NO to vendors until they pass the stricter quality tests than any of their competitors.

 

You can search for 3rd party independent test results as well.  There is a reason businesses caring about network quality for their business choose to work with Verizon over Comcast, Charter, T-Mobile & AT&T.

 

I'm a little confused.  You post a link that says its for broadband and then different numbers than the original post.  In addition, the second set of numbers includes 4G wireless broadband.  Lastly, even if you assume it's not zero probability, it might as well be.  And that goes for reliability, speed, and total capacity available per user.  There is virtually no chance that ANY WIRELESS broadband service (across a large swath of their footprints) will match the speeds (down) that cable offers now, let alone what cable will have in 3-5 years (up and down).  And there is even less chance that wireless broadband users will be able to even come close to gigs used per month (cable averages are around 400-500 (climbing 30% a year) and wireless is like 10-15) no matter what they say about their increased capacity from 5G.  Now this may still turn out to be a decent business for Verizon because there is still lots of rural dwellings without access to 10-15 mbps and their broadband is piggybacking on their mobile investment.  They will also no doubt pick up some traditional cable/fiber broadband users.  However, it does not look like a threat to cable and may actually be a net positive

 

Verizon is making strong statements about their network capacity and speeds for wireless broadband that are inconsistent with your view.  That certainly doesn't mean Verizon is right and you are wrong; I think the wireless carriers oversold fixed wireless broadband back in 2018/19, so I'm skeptical of their claims now.  But I don't have the physics background to evaluate their claims.  If you don't mind sharing, what sources do you rely on to convince yourself that Verizon is exaggerating what their network will be able to do.

 

I also note your separate point -- or which I understand to be a separate point -- that by the time Verizon gets a broadly available 1 gig broadband offering, people will be demanding/needing 5 or 10 gig broadband, which only cable/fiber to the home will be able to deliver.

[KJP]

They're targeting 1 to 2mm people by year end, and 15mm is their target for full coverage. Not sure where you're getting 100mm from.

They are planning 50 Million coverage by 2025.  Please see https://www.verizon.com/about/sites/default/files/Verizon-Investor-Day-Infographic-2021.pdf

 

Higher reliability? Absolutely no chance, just based on the physics. Speed, maybe, but a move to Docsis 4 and beyond can bring the cable plant up to 5G FWB speeds.

I disagree that the probability is 0%.  Reliability includes network congestion issues when your colleagues on cable internet are running into network issues.  During WFH, if you work with a few hundred folks, you will start hearing how many run into network issues with cable internet.

 

If you have worked with carriers and cable internet providers on taking network equipment & devices, you will realize how high of a bar Verizon has for its vendors compared to other carrier and cable internet providers. To get there, it takes culture to be focused on reliability and be willing to say NO to vendors until they pass the stricter quality tests than any of their competitors.

 

You can search for 3rd party independent test results as well.  There is a reason businesses caring about network quality for their business choose to work with Verizon over Comcast, Charter, T-Mobile & AT&T.

 

I'm a little confused.  You post a link that says its for broadband and then different numbers than the original post.  In addition, the second set of numbers includes 4G wireless broadband.  Lastly, even if you assume it's not zero probability, it might as well be.  And that goes for reliability, speed, and total capacity available per user.  There is virtually no chance that ANY WIRELESS broadband service (across a large swath of their footprints) will match the speeds (down) that cable offers now, let alone what cable will have in 3-5 years (up and down).  And there is even less chance that wireless broadband users will be able to even come close to gigs used per month (cable averages are around 400-500 (climbing 30% a year) and wireless is like 10-15) no matter what they say about their increased capacity from 5G.  Now this may still turn out to be a decent business for Verizon because there is still lots of rural dwellings without access to 10-15 mbps and their broadband is piggybacking on their mobile investment.  They will also no doubt pick up some traditional cable/fiber broadband users.  However, it does not look like a threat to cable and may actually be a net positive

 

Looks, like you're mixing up posts from dwy000 and me.  I never mentioned different figures.

 

Verizon 5G Home is actually seeing 20+GB per day usage.  Please see slide 38 at https://www.verizon.com/about/sites/default/files/2020-11/Verizon_Nov11_Analyst_Meeting.pdf. 

 

I understand some folks can make predictions like "no chance".  All the power to you.  I cannot make such strong predictions, but I'd say there is higher than 50-70% probability that Verizon 5G high band will be able to deliver higher speeds and higher reliability than cable internet, and they will ensure to have strict quality bar on their vendors to pass tests in different weather conditions, and they will continue to monitor their network capacity and quality issues and jump on them before their customers even notice them, unlike cable companies.  In the iphone launch, Apple stood by with Verion's claims that they are getting 4.0Gbps on Verizon high band, backing it up with Apple's own brand: https://www.youtube.com/watch?v=KR0g-1hnQPA.  I understand that is high band, and it will be lower than that for mid-band.  If memory serves right, I believe Verizon is only claiming 1+ gigabit per second for 5G nationwide home internet  - it is somewhere in the videos and links - don't have the link handy for that.

 

LM: does your belief extend to fiber-to-the-premise networks, or only more traditional HFC networks?

[vince]

I'm not sure....I was replying to the figures he used in his post, they were the exact numbers Verizon used for their mobile 5G that I saw while looking at their presentation yesterday.  Not a big deal.  Also, if you have come across reliable studies that you are using in making your predictions, please share.

[LearningMachine]

you didnt post those numbers but when i posted that the original figures were wireless and not broadband, you responded that they were broadband. 

 

My apologies for the misunderstanding.  I think I know what might be the confusion.

 

Vince, so that I can resolve the misunderstanding, are you talking about my post here: https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/charter-communications/msg454307/#msg454307

[LearningMachine]

They're targeting 1 to 2mm people by year end, and 15mm is their target for full coverage. Not sure where you're getting 100mm from.

They are planning 50 Million coverage by 2025.  Please see https://www.verizon.com/about/sites/default/files/Verizon-Investor-Day-Infographic-2021.pdf

 

Higher reliability? Absolutely no chance, just based on the physics. Speed, maybe, but a move to Docsis 4 and beyond can bring the cable plant up to 5G FWB speeds.

I disagree that the probability is 0%.  Reliability includes network congestion issues when your colleagues on cable internet are running into network issues.  During WFH, if you work with a few hundred folks, you will start hearing how many run into network issues with cable internet.

 

If you have worked with carriers and cable internet providers on taking network equipment & devices, you will realize how high of a bar Verizon has for its vendors compared to other carrier and cable internet providers. To get there, it takes culture to be focused on reliability and be willing to say NO to vendors until they pass the stricter quality tests than any of their competitors.

 

You can search for 3rd party independent test results as well.  There is a reason businesses caring about network quality for their business choose to work with Verizon over Comcast, Charter, T-Mobile & AT&T.

 

I'm a little confused.  You post a link that says its for broadband and then different numbers than the original post.  In addition, the second set of numbers includes 4G wireless broadband.  Lastly, even if you assume it's not zero probability, it might as well be.  And that goes for reliability, speed, and total capacity available per user.  There is virtually no chance that ANY WIRELESS broadband service (across a large swath of their footprints) will match the speeds (down) that cable offers now, let alone what cable will have in 3-5 years (up and down).  And there is even less chance that wireless broadband users will be able to even come close to gigs used per month (cable averages are around 400-500 (climbing 30% a year) and wireless is like 10-15) no matter what they say about their increased capacity from 5G.  Now this may still turn out to be a decent business for Verizon because there is still lots of rural dwellings without access to 10-15 mbps and their broadband is piggybacking on their mobile investment.  They will also no doubt pick up some traditional cable/fiber broadband users.  However, it does not look like a threat to cable and may actually be a net positive

 

Looks, like you're mixing up posts from dwy000 and me.  I never mentioned different figures.

 

Verizon 5G Home is actually seeing 20+GB per day usage.  Please see slide 38 at https://www.verizon.com/about/sites/default/files/2020-11/Verizon_Nov11_Analyst_Meeting.pdf. 

 

I understand some folks can make predictions like "no chance".  All the power to you.  I cannot make such strong predictions, but I'd say there is higher than 50-70% probability that Verizon 5G high band will be able to deliver higher speeds and higher reliability than cable internet, and they will ensure to have strict quality bar on their vendors to pass tests in different weather conditions, and they will continue to monitor their network capacity and quality issues and jump on them before their customers even notice them, unlike cable companies.  In the iphone launch, Apple stood by with Verion's claims that they are getting 4.0Gbps on Verizon high band, backing it up with Apple's own brand: https://www.youtube.com/watch?v=KR0g-1hnQPA.  I understand that is high band, and it will be lower than that for mid-band.  If memory serves right, I believe Verizon is only claiming 1+ gigabit per second for 5G nationwide home internet  - it is somewhere in the videos and links - don't have the link handy for that.

 

LM: does your belief extend to fiber-to-the-premise networks, or only more traditional HFC networks?

 

KJP, good question.  My view does not extend to fiber-to-the-premise networks.  Fiber-to-the-premises will be highest quality very long-term.  However, it is costly to deploy.  For the short to medium term, Verizon has figured out having 5G antennas hanging off FIOS is faster than cable internet, and they want to capture that income stream, by just building that fiber backbone cost-efficiently. 

 

Beyond cost and timing mismatch on not being able to monetize Fiber-to-the-premises much better than 5G home for short-to-medium-term, another issue with companies building Fiber-to-the-premises is that they have no monopsony power to negotiate better contracts with content providers.  Verizon has lots of that monopsony power with strong brands like Disney, Discovery, etc. that Ronan winked in the March 10, 2021 session that they are going to leverage further.  They can get much much cheaper content deals than what content companies will give smaller providers, in order to get access to Verizon's largest digital products & services distribution platform in the U.S., especially with their high quality, loyal and price insensitive customers.  Remember, Malone was able to get free equity stakes in content providers with this power.

 

[vince]

They're targeting 1 to 2mm people by year end, and 15mm is their target for full coverage. Not sure where you're getting 100mm from.

They are planning 50 Million coverage by 2025.  Please see https://www.verizon.com/about/sites/default/files/Verizon-Investor-Day-Infographic-2021.pdf

 

Higher reliability? Absolutely no chance, just based on the physics. Speed, maybe, but a move to Docsis 4 and beyond can bring the cable plant up to 5G FWB speeds.

I disagree that the probability is 0%.  Reliability includes network congestion issues when your colleagues on cable internet are running into network issues.  During WFH, if you work with a few hundred folks, you will start hearing how many run into network issues with cable internet.

 

If you have worked with carriers and cable internet providers on taking network equipment & devices, you will realize how high of a bar Verizon has for its vendors compared to other carrier and cable internet providers. To get there, it takes culture to be focused on reliability and be willing to say NO to vendors until they pass the stricter quality tests than any of their competitors.

 

You can search for 3rd party independent test results as well.  There is a reason businesses caring about network quality for their business choose to work with Verizon over Comcast, Charter, T-Mobile & AT&T.

 

I'm a little confused.  You post a link that says its for broadband and then different numbers than the original post.  In addition, the second set of numbers includes 4G wireless broadband.  Lastly, even if you assume it's not zero probability, it might as well be.  And that goes for reliability, speed, and total capacity available per user.  There is virtually no chance that ANY WIRELESS broadband service (across a large swath of their footprints) will match the speeds (down) that cable offers now, let alone what cable will have in 3-5 years (up and down).  And there is even less chance that wireless broadband users will be able to even come close to gigs used per month (cable averages are around 400-500 (climbing 30% a year) and wireless is like 10-15) no matter what they say about their increased capacity from 5G.  Now this may still turn out to be a decent business for Verizon because there is still lots of rural dwellings without access to 10-15 mbps and their broadband is piggybacking on their mobile investment.  They will also no doubt pick up some traditional cable/fiber broadband users.  However, it does not look like a threat to cable and may actually be a net positive

 

Verizon is making strong statements about their network capacity and speeds for wireless broadband that are inconsistent with your view.  That certainly doesn't mean Verizon is right and you are wrong; I think the wireless carriers oversold fixed wireless broadband back in 2018/19, so I'm skeptical of their claims now.  But I don't have the physics background to evaluate their claims.  If you don't mind sharing, what sources do you rely on to convince that Verizon is exaggerating what their network will be able to do.

 

I also note your separate point -- or which I understand to be a separate point -- that by the time Verizon gets a broadly available 1 gig broadband offering, people will be demanding/needing 5 or 10 gig broadband, which only cable/fiber to the home will be able to deliver.

 

I have never saved in an organized way the sources I have read over the last 10 years (I started with Directv in this industry in 2011) but I can assure you I have spent many hours reading everything I could get my hands on as I put close to 50% of my net worth in Directv.  At that time I didnt see the attractiveness of the cable business, hence the DTV investment.  However, during my roughly 3 year holding DTV, the research I was doing convinced me that cable was in fact MUCH BETTER positioned than all the other players.  AT&T made a bid for DTV that I sold into and shortly after I made various cable companies close to 50% of my net worth, eventually consolidating 90% (of that 50%) into Charter, Liberty Ventures/Gliba, and Liberty Broadband.  I have also studied the telecoms and owned Verizon on and off in the last 5 years and currently own it again.  My sources include many things said and written by the 3 telecoms including when their interests weren't perfectly aligned with a 5G world. I don't believe Verizon will get to 1 Gig broadly (combined with similar capacity to cable) and that if they ever do, across a broad footprint, demand will be past that.  Please note that Verizon is now including 4G with their wireless broadband coverage claims and executives are starting to lose patience on conference calls with analysts trying to hold them to their earlier claims.  I think it's safe to say that the great majority of research continues to point to the massive infrastructure cost advantage that cable possesses on an incremental basis.  I think you have to start with that premise which will help investors filter any new information (or claims) that they come across. 

[KJP]

 

Beyond cost and timing mismatch on not being able to monetize Fiber-to-the-premises much better than 5G home for short-to-medium-term, another issue with companies building Fiber-to-the-premises is that they have no monopsony power to negotiate better contracts with content providers.  Verizon has lots of that monopsony power with strong brands like Disney, Discovery, etc. that Ronan winked in the March 10, 2021 session that they are going to leverage further.  They can get much much cheaper content deals than what content companies will give smaller providers, in order to get access to Verizon's largest digital products & services distribution platform in the U.S., especially with their high quality, loyal and price insensitive customers.  Remember, Malone was able to get free equity stakes in content providers with this power.

 

This is probably better suited to the Verizon thread, but I don't see true monopsony power here.  If I correctly understand how things were in the old days, Malone's cable systems were truly the only game in town.  If you didn't get carriage on his system, then you didn't get carriage in that geography period.  In that world, he was a true monopsonist. 

 

To my knowledge, Verizon isn't going to deny access to its network to anyone if they don't cut a deal, and I believe Verizon would be playing with regulatory fire if it tried.  Instead, my understanding of your argument is that Verizon is assembling a bundle to sell to their customers, and content providers like Discovery are going to have to give Verizon a juicy cut of their economics if they want to get in Verizon's bundle.  But any digital service can go DTC and there are many of existing and potential future digital bundlers (Amazon, Google, Apple, etc.).  So, unless I misunderstand the landscape, I don't see how Verizon is a monopsonist of digital content.

[LearningMachine]

 

Beyond cost and timing mismatch on not being able to monetize Fiber-to-the-premises much better than 5G home for short-to-medium-term, another issue with companies building Fiber-to-the-premises is that they have no monopsony power to negotiate better contracts with content providers.  Verizon has lots of that monopsony power with strong brands like Disney, Discovery, etc. that Ronan winked in the March 10, 2021 session that they are going to leverage further.  They can get much much cheaper content deals than what content companies will give smaller providers, in order to get access to Verizon's largest digital products & services distribution platform in the U.S., especially with their high quality, loyal and price insensitive customers.  Remember, Malone was able to get free equity stakes in content providers with this power.

 

This is probably better suited to the Verizon thread, but I don't see true monopsony power here.  If I correctly understand how things were in the old days, Malone's cable systems were truly the only game in town.  If you didn't get carriage on his system, then you didn't get carriage in that geography period.  In that world, he was a true monopsonist. 

 

To my knowledge, Verizon isn't going to deny access to its network to anyone if they don't cut a deal, and I believe Verizon would be playing with regulatory fire if it tried.  Instead, my understanding of your argument is that Verizon is assembling a bundle to sell to their customers, and content providers like Discovery are going to have to give Verizon a juicy cut of their economics if they want to get in Verizon's bundle.  But any digital service can go DTC and there are many of existing and potential future digital bundlers (Amazon, Google, Apple, etc.).  So, unless I misunderstand the landscape, I don't see how Verizon is a monopsonist of digital content.

 

KJP, I agree Verizon's monopsony power is not as strong as being the only game in town.  Verizon's power is similar to Amazon's power with book publishers, and Walmart's power with food brands, where they can effectively sell the product to customer cheaper than what the supplier charges other competitors or sell directly.  The key metric to watch here would be what percentage of the brand's business will be going through Verizon. 

 

They claim to have a line of streaming companies approaching them, but they are saying NO to them as they are being very selective on which brands they are saying yes to.  They are also claiming they are not paying Disney anywhere near $18.99 that Disney is charging directly.

[vince]

Did anyone else watch the verizon presentation?  About half way through, and at the end of the CFO's talk, when he refers to company revenues in 2024 and beyond, he states that.....Wireless broadband will have "well over a billion dollars of revenue".  Obviously the statement is vague but I just cannot see how that number jives with their wireless broadband (WB) footprint predictions for those same years.  Maybe someone else can point out something I may be missing?  I want to repeat that I think Verizon can deliver fantastic returns going forward combined with extreme safety.  This is not easy to find in this environment.  But I wouldn't count on them (nor do they need to) disrupting cable's business within 5-7 years.  They can capture some industry profit without hurting cable's investment thesis IMO

[LearningMachine]

Did anyone else watch the verizon presentation?  About half way through, and at the end of the CFO's talk, when he refers to company revenues in 2024 and beyond, he states that.....Wireless broadband will have "well over a billion dollars of revenue".  Obviously the statement is vague but I just cannot see how that number jives with their wireless broadband (WB) footprint predictions for those same years.  Maybe someone else can point out something I may be missing?  I want to repeat that I think Verizon can deliver fantastic returns going forward combined with extreme safety.  This is not easy to find in this environment.  But I wouldn't count on them (nor do they need to) disrupting cable's business within 5-7 years.  They can capture some industry profit without hurting cable's investment thesis IMO

 

Hi Vince, I've watched it a few times :-). 

 

The billion dollar of revenue is mentioned when he is talking about 2022-2023, that is before he starts talking about 2024 :-).

 

He starts talking about their home broadband plans @ 51:43 minutes at https://youtu.be/C0JNCwmCmCg.

 

Here are the figures he mentions regarding home broadband

• Next 12 months (2021): 15 million households covered, including 1-2 million through mmWave.
  
• 2022-2023: 30 million households covered with fixed wireless access.  Fixed wireless access becomes a billion dollar revenue business.
  
• 2024 & beyond: 50 million households covered.
  

 

They are charging $50 for Verizon customers and $70 for non-Verizon customers for 5G Home Internet service at https://www.verizon.com/5g/home/. 

 

Assuming $50 per month, $600 per year, needs only 1.67 million subscribers to hit billion dollars.  Are you saying achieving billion dollars is too high or too little for 2022-2023?

 

My apologies earlier for including the link to https://www.verizon.com/5g/home/ earlier at https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/charter-communications/msg454307/#msg454307 in response to thinking that your point was that Verizon 5g service at those prices was available only for mobile devices, and not available for home broadband when you said "[t]hats for their mobile 5G.  [d]ifferent story for broadband".  Perhaps you had meant something else.

[LearningMachine]

For those interested in how T-Mobile is also coming to the party, their home internet plans to take away market share from cable companies starts @ 2:11:30 at the link below. 

 

https://onlinexperiences.com/Launch/QReg/ShowUUID=6E14EFE8-40B8-400F-90AF-AD15CCF1E47B

 

Fyi, T-Mobile's speeds will be lower than what Verizon will offer because T-Mobile will be using their low-band and mid-band while Verizon will be able to offer higher speeds on mmwave highband and cband, which are higher frequency than T-Mobile's mid-band and low-band.

[vince]

Did anyone else watch the verizon presentation?  About half way through, and at the end of the CFO's talk, when he refers to company revenues in 2024 and beyond, he states that.....Wireless broadband will have "well over a billion dollars of revenue".  Obviously the statement is vague but I just cannot see how that number jives with their wireless broadband (WB) footprint predictions for those same years.  Maybe someone else can point out something I may be missing?  I want to repeat that I think Verizon can deliver fantastic returns going forward combined with extreme safety.  This is not easy to find in this environment.  But I wouldn't count on them (nor do they need to) disrupting cable's business within 5-7 years.  They can capture some industry profit without hurting cable's investment thesis IMO

 

Hi Vince, I've watched it a few times :-). 

 

The billion dollar of revenue is mentioned when he is talking about 2022-2023, that is before he starts talking about 2024 :-).

 

He starts talking about their home broadband plans @ 51:43 minutes at https://youtu.be/C0JNCwmCmCg.

 

Here are the figures he mentions regarding home broadband

• Next 12 months (2021): 15 million households covered, including 1-2 million through mmWave.
  
• 2022-2023: 30 million households covered with fixed wireless access.  Fixed wireless access becomes a billion dollar revenue business.
  
• 2024 & beyond: 50 million households covered.
  

 

They are charging $50 for Verizon customers and $70 for non-Verizon customers for 5G Home Internet service at https://www.verizon.com/5g/home/. 

 

Assuming $50 per month, $600 per year, needs only 1.67 million subscribers to hit billion dollars.  Are you saying achieving billion dollars is too high or too little for 2022-2023?

 

My apologies earlier for including the link to https://www.verizon.com/5g/home/ earlier at https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/charter-communications/msg454307/#msg454307 in response to thinking that your point was that Verizon 5g service at those prices was available only for mobile devices, and not available for home broadband when you said "[t]hats for their mobile 5G.  [d]ifferent story for broadband".  Perhaps you had meant something else.

 

I appreciate the follow up, and I will watch it again.  I would think that a billion dollars is way too low assuming it was 2024 and beyond just based on their enthusiasm and the size of their coverage.  As far as what I meant when I said "that was for mobile....", I just assumed that all the figures he used in the post were for mobile based on the last line where he mentions the coverage.  I didn't hit your link.  Just a misunderstanding

 

[LearningMachine]

Did anyone else watch the verizon presentation?  About half way through, and at the end of the CFO's talk, when he refers to company revenues in 2024 and beyond, he states that.....Wireless broadband will have "well over a billion dollars of revenue".  Obviously the statement is vague but I just cannot see how that number jives with their wireless broadband (WB) footprint predictions for those same years.  Maybe someone else can point out something I may be missing?  I want to repeat that I think Verizon can deliver fantastic returns going forward combined with extreme safety.  This is not easy to find in this environment.  But I wouldn't count on them (nor do they need to) disrupting cable's business within 5-7 years.  They can capture some industry profit without hurting cable's investment thesis IMO

 

Hi Vince, I've watched it a few times :-). 

 

The billion dollar of revenue is mentioned when he is talking about 2022-2023, that is before he starts talking about 2024 :-).

 

He starts talking about their home broadband plans @ 51:43 minutes at https://youtu.be/C0JNCwmCmCg.

 

Here are the figures he mentions regarding home broadband

• Next 12 months (2021): 15 million households covered, including 1-2 million through mmWave.
  
• 2022-2023: 30 million households covered with fixed wireless access.  Fixed wireless access becomes a billion dollar revenue business.
  
• 2024 & beyond: 50 million households covered.
  

 

They are charging $50 for Verizon customers and $70 for non-Verizon customers for 5G Home Internet service at https://www.verizon.com/5g/home/. 

 

Assuming $50 per month, $600 per year, needs only 1.67 million subscribers to hit billion dollars.  Are you saying achieving billion dollars is too high or too little for 2022-2023?

 

My apologies earlier for including the link to https://www.verizon.com/5g/home/ earlier at https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/charter-communications/msg454307/#msg454307 in response to thinking that your point was that Verizon 5g service at those prices was available only for mobile devices, and not available for home broadband when you said "[t]hats for their mobile 5G.  [d]ifferent story for broadband".  Perhaps you had meant something else.

 

I appreciate the follow up, and I will watch it again.  I would think that a billion dollars is way too low assuming it was 2024 and beyond just based on their enthusiasm and the size of their coverage.  As far as what I meant when I said "that was for mobile....", I just assumed that all the figures he used in the post were for mobile based on the last line where he mentions the coverage.  I didn't hit your link.  Just a misunderstanding

 

Got it, thanks Vince for clarifying the misunderstanding.  Makes me feel better :-).  I really appreciate your perspectives.

 

In earlier talks, before the spectrum purchase, Verizon was planning to focus on offering high-speed internet in mmwave high-band areas where they can hit up to 4 Gbps.  After the spectrum purchase, looks like they evolved their plan to offer high-speed internet across more people.

 

I felt Verizon's CFO is financially really intelligent in how he explained they are getting the spectrum for free on cash basis by amortizing the cost over 15 years and deducting interest.  I think he was being conservative when he said they will have a billion dollar home internet business in 2022-2023. 

[vince]

We have to assume that some of the wireless broadband units that they are predicting will come from rural areas where there is no cable or fiber.  Maybe even most of their sales. This may also be why Verizon is talking coverage and including 4G in their broadband numbers.  If that is the case then within those numbers there isnt very many cable customers.  Charter and comcast capture well over a million data customers annually, comcast for 13-14 years in a row

[vince]

Did anyone else watch the verizon presentation?  About half way through, and at the end of the CFO's talk, when he refers to company revenues in 2024 and beyond, he states that.....Wireless broadband will have "well over a billion dollars of revenue".  Obviously the statement is vague but I just cannot see how that number jives with their wireless broadband (WB) footprint predictions for those same years.  Maybe someone else can point out something I may be missing?  I want to repeat that I think Verizon can deliver fantastic returns going forward combined with extreme safety.  This is not easy to find in this environment.  But I wouldn't count on them (nor do they need to) disrupting cable's business within 5-7 years.  They can capture some industry profit without hurting cable's investment thesis IMO

 

Hi Vince, I've watched it a few times :-). 

 

The billion dollar of revenue is mentioned when he is talking about 2022-2023, that is before he starts talking about 2024 :-).

 

He starts talking about their home broadband plans @ 51:43 minutes at https://youtu.be/C0JNCwmCmCg.

 

Here are the figures he mentions regarding home broadband

• Next 12 months (2021): 15 million households covered, including 1-2 million through mmWave.
  
• 2022-2023: 30 million households covered with fixed wireless access.  Fixed wireless access becomes a billion dollar revenue business.
  
• 2024 & beyond: 50 million households covered.
  

 

They are charging $50 for Verizon customers and $70 for non-Verizon customers for 5G Home Internet service at https://www.verizon.com/5g/home/. 

 

Assuming $50 per month, $600 per year, needs only 1.67 million subscribers to hit billion dollars.  Are you saying achieving billion dollars is too high or too little for 2022-2023?

 

My apologies earlier for including the link to https://www.verizon.com/5g/home/ earlier at https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/charter-communications/msg454307/#msg454307 in response to thinking that your point was that Verizon 5g service at those prices was available only for mobile devices, and not available for home broadband when you said "[t]hats for their mobile 5G.  [d]ifferent story for broadband".  Perhaps you had meant something else.

 

I appreciate the follow up, and I will watch it again.  I would think that a billion dollars is way too low assuming it was 2024 and beyond just based on their enthusiasm and the size of their coverage.  As far as what I meant when I said "that was for mobile....", I just assumed that all the figures he used in the post were for mobile based on the last line where he mentions the coverage.  I didn't hit your link.  Just a misunderstanding

 

Got it, thanks Vince for clarifying the misunderstanding.  Makes me feel better :-).  I really appreciate your perspectives.

 

In earlier talks, before the spectrum purchase, Verizon was planning to focus on offering high-speed internet in mmwave high-band areas where they can hit up to 4 Gbps.  After the spectrum purchase, looks like they evolved their plan to offer high-speed internet across more people.

 

I felt Verizon's CFO is financially really intelligent in how he explained they are getting the spectrum for free on cash basis by amortizing the cost over 15 years and deducting interest.  I think he was being conservative when he said they will have a billion dollar home internet business in 2022-2023.

 

I actually like Verizon's CEO, their aggressive cost cutting, their renewed focus on their core asset, and their whole strategy around 5G.  They have the best network and the scale to build on it like their competitors cannot.  I do not envision cable making a serious dent to wireless business and same goes for wireless changing the investment thesis for cable.  They will absolutely consolidate at some point here because the economic rationale is just way too compelling and IMO it will happen on terms that are favorable to cable

[vince]

For those interested in how T-Mobile is also coming to the party, their home internet plans to take away market share from cable companies starts @ 2:11:30 at the link below. 

 

https://onlinexperiences.com/Launch/QReg/ShowUUID=6E14EFE8-40B8-400F-90AF-AD15CCF1E47B

 

Fyi, T-Mobile's speeds will be lower than what Verizon will offer because T-Mobile will be using their low-band and mid-band while Verizon will be able to offer higher speeds on mmwave highband and cband, which are higher frequency than T-Mobile's mid-band and low-band.

 

The 4-5 factors in their strategy reads like they copied it from Rutledges playbook.  Value pricing, fast reliable internet, simple packaging, focus on self install, no complicated contracts with exploding prices etc

[LearningMachine]

Did anyone else watch the verizon presentation?  About half way through, and at the end of the CFO's talk, when he refers to company revenues in 2024 and beyond, he states that.....Wireless broadband will have "well over a billion dollars of revenue".  Obviously the statement is vague but I just cannot see how that number jives with their wireless broadband (WB) footprint predictions for those same years.  Maybe someone else can point out something I may be missing?  I want to repeat that I think Verizon can deliver fantastic returns going forward combined with extreme safety.  This is not easy to find in this environment.  But I wouldn't count on them (nor do they need to) disrupting cable's business within 5-7 years.  They can capture some industry profit without hurting cable's investment thesis IMO

 

Hi Vince, I've watched it a few times :-). 

 

The billion dollar of revenue is mentioned when he is talking about 2022-2023, that is before he starts talking about 2024 :-).

 

He starts talking about their home broadband plans @ 51:43 minutes at https://youtu.be/C0JNCwmCmCg.

 

Here are the figures he mentions regarding home broadband

• Next 12 months (2021): 15 million households covered, including 1-2 million through mmWave.
  
• 2022-2023: 30 million households covered with fixed wireless access.  Fixed wireless access becomes a billion dollar revenue business.
  
• 2024 & beyond: 50 million households covered.
  

 

They are charging $50 for Verizon customers and $70 for non-Verizon customers for 5G Home Internet service at https://www.verizon.com/5g/home/. 

 

Assuming $50 per month, $600 per year, needs only 1.67 million subscribers to hit billion dollars.  Are you saying achieving billion dollars is too high or too little for 2022-2023?

 

My apologies earlier for including the link to https://www.verizon.com/5g/home/ earlier at https://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/charter-communications/msg454307/#msg454307 in response to thinking that your point was that Verizon 5g service at those prices was available only for mobile devices, and not available for home broadband when you said "[t]hats for their mobile 5G.  [d]ifferent story for broadband".  Perhaps you had meant something else.

 

I appreciate the follow up, and I will watch it again.  I would think that a billion dollars is way too low assuming it was 2024 and beyond just based on their enthusiasm and the size of their coverage.  As far as what I meant when I said "that was for mobile....", I just assumed that all the figures he used in the post were for mobile based on the last line where he mentions the coverage.  I didn't hit your link.  Just a misunderstanding

 

Got it, thanks Vince for clarifying the misunderstanding.  Makes me feel better :-).  I really appreciate your perspectives.

 

In earlier talks, before the spectrum purchase, Verizon was planning to focus on offering high-speed internet in mmwave high-band areas where they can hit up to 4 Gbps.  After the spectrum purchase, looks like they evolved their plan to offer high-speed internet across more people.

 

I felt Verizon's CFO is financially really intelligent in how he explained they are getting the spectrum for free on cash basis by amortizing the cost over 15 years and deducting interest.  I think he was being conservative when he said they will have a billion dollar home internet business in 2022-2023.

 

I actually like Verizon's CEO, their aggressive cost cutting, their renewed focus on their core asset, and their whole strategy around 5G.  They have the best network and the scale to build on it like their competitors cannot.  I do not envision cable making a serious dent to wireless business and same goes for wireless changing the investment thesis for cable.  They will absolutely consolidate at some point here because the economic rationale is just way too compelling and IMO it will happen on terms that are favorable to cable

 

I worry the issue for cable is multifold here.  All three carriers will be coming for their business, and as T-Mobile presentation mentioned, the customer satisfaction levels are so low that customers will be inclined to take whatever other option they can get as long as it is better from some perspective.  The other issue is how much they have to pay content providers as they can't negotiate better pricing with them.  Now, add in debt levels.  You never wanna be holding an entity with high debts where there is a risk of earnings going down - to me, that is gambling as the downward spiral can be hard to get out of.  Sure, you might get lucky, but at what risk.

 

From a very long term perspective, access to licensed spectrum will be a necessity and you cannot create more spectrum but you can always lay down more fiber. 

 

Very long term, arguably, after it has milked licensed spectrum for home internet for all it can, when customers want even more bandwidth, Verizon can leverage the need to get access to licensed spectrum to also sell fiber at some point.

 

So, I've a hard time seeing it working in cable's favor. Please feel free to not take this input.

[vince]

If what you say is accurate then why did VZ's previous CEO try and scoop up Charter?  Just because the telecoms say they are coming, doesn't mean they will take share.  And shrinking earnings for cable is so far from reality, I don't want to entertain it (only way that will happen is with heavy handed regulatory changes).  I think you may be missing the fact that cable is already taking millions of wireless customers (charter was fastest growing wireless provider in 3 out of 4 quarters in 2020) and telecoms wireless broadband aspirations are questionable at best.  Did you know that 80% of wireless data already travels over cables infrastructure?  Did you also realize that cable has a massive incremental cost advantage for high speed infrastructure? That means they are the low cost provider or another way to say they can drop prices to the point of bleeding the telecoms dry.  Of course they will not do this because it will hurt their own business but it does mean they can get very creative around their pricing and packaging.  There are strong fundamental reasons why cable is rapidly gaining broadband customers and why it has historically been very difficult to disrupt their business, even with a superior product....think satellite.  I will not claim that wireless is not a threat to watch closely, but I don't know how wise it is to claim that shrinking earnings is just around the corner for cable.  Take a look at the ebitda multiple comparisons between wireless and cable and see how much everyone agrees with your assessment.  My friend, in the VERY long term we will both be dead