“We were all trained to believe cable operators and the phone companies
were natural enemies,” said Craig Moffett, an analyst at Sanford C.
Bernstein & Company.
Cable operators and phone companies thought so, too, but the cable
companies have largely ended efforts to compete in the mobile phone
business because the cost of building their own wireless networks could
be prohibitive.
Instead, they can use Verizon to attract customers without investing in a
network of stores. “We’ve looked at a whole range of options for how to
fulfill that customer need, including building our own cellular
carrier, but we concluded we would be a late entrant in a highly
competitive business,” said Peter Stern, chief strategy officer at Time
Warner Cable.
Cox, which tested the waters in the wireless market, now sells Verizon
products and services in its Cox Solutions Stores in Tulsa, Okla., and
Oklahoma City. Cox, which is based in Atlanta, has 130 retail locations
and predicts Verizon will be a major part of its offerings.
Now let me refresh a few on the technical facts:
1. LTE/OFDM can accommodate 8 bps/Hz of bandwidth.
2. Verizon just got a tremendous amount of bandwidth.
3. Adaptive beam antenna can multiple OFDM by a factor of 10, thus almost 80 bps/Hz.
4. MPEG 4 runs at 2 Mbps and H.265 will half the rate of H.264 with HDTV.
5. Verizon can then provide direct to the home HD TV and everything else with their exiting bandwidth and cell sites.
What does this mean:
1. Cable companies will have near instantaneous competitors at marginally lower costs.
2. Verizon has a union problem on the wireline side. Thus the ending of FIOS, along with its costs. There is no union on the wireless side so by switching to all wireless means the end of the unions, and further reductions in costs.
3. Wireless is seamless between fixed and mobile, same techniques, and thus extends over the customer's life cycle.
4. By being the face to the customer you get to own the customer. Going forward Verizon could own all of the customers and the CATV guys are left behind.
So who thinks this is a good idea?
Posts
