Measuring Cellular Fixed Wireless Access For WFH

In the first installment of this series on fixed wireless access (FWA), I introduced some of the economic and technical challenges facing fixed wireless providers in delivering the capacity, reliability, and consistency on par with wired broadband connections. In this second entry, I’ll look at the FWA offerings from the cellular operators. In subsequent posts, we’ll look at the new low-earth-orbit satellite (LEOS) constellations SpaceX’s Starlink is planning and Amazon’s Kuiper. We’ll also examine more esoteric options for delivering Internet access without wires.

 

Fixed wireless access was one of two major initiatives that cellular operators hoped would boost revenues to justify the massive investments in upgrading their networks to 5G. The other hope was private 5G networks for enterprises I’ve written about extensively.

 

The idea of selling private 5G networks to enterprises having already heavily invested in Wi-Fi networks has proved to be a heavy lift. However, about all the carriers needed to get into FWA were a source for cellular modems (readily available from companies like Cradlepoint and Sierra Wireless) and a way to bill for it. Oh—and a wide-reaching mass-market advertising campaign costing hundreds of millions of dollars would be helpful, too.

 

Fortunately, the cellular carriers are already spending big on brand awareness advertising and are always looking out for a new theme. According to a survey from adbrands.net, AT&T, Verizon, and T-Mobile ranked numbers three, six, and 16 among the country’s top advertisers in 2020 by expenditures. We should note that cable Internet providers Comcast and Charter Spectrum came in at numbers two and seven.

 

The cellular carrier’s FWA service is essentially flat rate, best-effort wireless Internet access service from fixed locations (in specified areas) with no usage caps and no data rate guarantees. The most attractive feature of FWA for the cellular carriers is that it uses their existing cellular data service, officially called enhanced mobile broadband, so it could be made available to any area with cellular data service. However, the carriers place hard restrictions regarding the areas where they will provide FWA. Further, if you want to move the service later, you can only move to another area where the cellular carrier offers FWA.

 

The carriers’ sweet spot for FWA seems to be areas with 5G support (particularly mid-band 5G) but with manageable mobile broadband traffic, so the fixed service won’t degrade the network performance for mobile users. With the obstacles the carriers have constructed, you have to wonder how serious they are about making this a success.

 

Enterprise IT has made use of cellular data service from fixed locations for years, primarily using cellular as a backup or fail-over for dedicated inter-site multiprotocol label switching (MPLS) or other wired Internet connections. With the advent of software-defined WANs (SD-WANs), these cellular connections are increasingly being used not just as back-up, but as part of the everyday wide area network service mix.

 

Cellular back-up was a low-cost insurance policy for enterprise inter-site connections, but the carriers are aiming at the big prize with FWA, residential Internet service. Statista reports the total U.S. revenues for fixed broadband services was $59.9 billion for 2021.

 

If fixed wireless is going to be one of the options our work from home (WFH) users are considering, we must be knowledgeable about how it will measure up to enterprise requirements.

 

The carriers are touting price as one of their major advantages in the residential broadband market. They also appear to be going after existing customers with even more attractive rates.

 

As we dissect the carrier offerings, we should note the major split among the carriers regarding FWA. Verizon and T-Mobile have jumped in with both feet, while AT&T continues to focus its broadband access efforts around fiber rather than FWA. At a recent analyst conference, AT&T’s Chief Operating Officer Jeff McElfresh, said, “we know that the physics of fixed wireless cannot serve the demand for what a household is looking for, or a business is looking for, for high-quality, premium broadband connectivity.”

 

AT&T does offer a special form of LTE-based FWA for rural areas to existing mobile wireless customers using an outdoor antenna to improve reception and advises users to “Expect speeds of at least 10 Mbps download and 1 Mbps upload. Customers typically experience download speeds of 25 Mbps.” That’s “broadband” only by the most charitable definition.

 

Verizon, and T-Mobile, on the other hand are making a major push for FWA and routinely report their results, including FWA additions, in their quarterly analyst calls, and are regularly adding sweeteners to enhance the deal.

 

In round numbers, cellular FWA prices are roughly half what we typically pay for residential cable modem or fiber broadband access. Basic prices are around $50 per month for existing mobile customers, with an additional $10 or $20 per month for non-customers. Verizon offers plans as low as $25 per month for select customers; T-Mobile can go as low as $30 per month for Magenta MAX customers. For that price, you get unlimited data (i.e., no caps) and a cellular modem with a built-in Wi-Fi router. Verizon and T-Mobile will also offer to buy out your existing broadband contract for up to $500.

 

While cellular FWA wins hands down on price, you cannot say the same of the data rate. Unlike wired Internet services, there are no guaranteed data rates with cellular fixed wireless access. T-Mobile’s FAQ page reads, “T-Mobile 5G Home Internet customers see typical download speeds between 33-182 Mbps.” Typical upload speeds are quoted as 6M to 23 Mbps. Verizon is more optimistic on its performance, citing download speeds between 86M and 300 Mbps for 5G and up to 70 Mbps for the LTE variety. Uploads are estimated at 10 Mbps.

 

The disparity here is interesting because T-Mobile has consistently ranked higher than Verizon regarding its network performance on published tests. Ookla’s Mobile Speed Test for the first quarter of this year shows T-Mobile with a median download speed of 117.3 Mbps to Verizon’s 62.2 Mbps. On the 5G speed test, T-Mobile had a median download speed of 191.12 Mbps versus 107.25 for Verizon.

 

You should note that all of those numbers should be taken with a grain of salt, as those tests get conducted primarily outdoors. To date, we have seen no published data that specifically reports on indoor FWA performance. T-Mobile’s CEO Mike Sievert counters that indoor performance with FWA can’t compare to indoor mobile use because of the better antennas in the premises equipment. While testimonials are encouraging, enterprise buyers generally rank actual guarantees and independent test results more highly.

 

Both carriers are counting on the mid-band sub-6 GHz spectrum to deliver speeds that meet the FCC’s defined broadband speed of 100 Mbps downstream and 20 Mbps upstream. One reason T-Mobile has leaped out in front on these speed tests in recent years was the ability to bring its 2.5 GHz mid-band spectrum (acquired with the Sprint purchase) online more quickly than the C Band spectrum Verizon and AT&T acquired more recently.

 

Using the much higher capacity, higher frequency (i.e., >20 GHz.) millimeter-wave spectrum delivering data rates close to a gigabit is an appealing but unrealistic option for FWA. Those higher-frequency transmissions cannot penetrate walls, and using them would require an outdoor antenna. FWA using millimeter-wave channels and outdoor antennas is more likely to be found in commercial and multi-tenant applications, as we are seeing from providers like Starry and Nextlink, or AT&T’s LTE-based rural FWA service referenced above.

 

The first-quarter results from both T-Mobile and Verizon show T-Mobile claims an installed base of 984,000 lines to Verizon’s 344,000 (based on earlier reports and subsequent sales numbers) for a total base of 1.3 million lines. To put those numbers in context, Statista estimates the number of fixed broadband households in the U.S. at around 121 million, so those cellular FWA subscribers represent about a 1% market share.

 

If the cellular carriers’ FWA performance measures up over time, enterprise WFH users could help add to those numbers. Enterprise FWA use could also grow at smaller locations, either as a primary service or as an adjunct to a wired Internet connection in an SD-WAN configuration.

 

Of course, if carriers continue to offer the service only in specially delineated areas, its value as an enterprise-wide alternative would diminish greatly.

 

If wired cable modem or fiber access is available, selecting the cellular carriers’ FWA offering would be hard to justify unless “cheap” is your primary objective. Until the new generation satellite networks get up and running, cellular FWA can boast the widest availability of any of the current FWA options. However, with the carrier-defined limits on where it offers FWA, it has nowhere near the coverage footprint of the cable and fiber alternatives.

 

The carriers’ advertising budgets should boost market awareness, but good advertising will get you in the door. The carriers still need to prove they can deliver adequate, consistent, and reliable service over the long. That applies particularly to the WFH population.

 

In the meantime, cable and fiber-based providers have 75% of the market and routinely guarantee data rates in hundreds of megabits and as high as a gigabit, while cellular FWA is just clearing the 100 Mbps mark, and that’s outdoors. Sure, the cellular offerings will improve, but it’s hard to see them hitting the gigabit mark without getting their millimeter wave spectrum involved, That requires a major challenge in delivering a service that requires outdoor antennas.

 

For the moment, I can’t imagine the cable and fiber-based ISPs are losing too much sleep over the challenge from cellular. For enterprise buyers to look more seriously at cellular FWA as a potential WFH option, the biggest help would be actual independent performance testing of indoor FWA services by companies like Ookla and RootMetrics.

 

One of the first lessons I learned when purchasing services for businesses, particularly those that rely on them to conduct their operations, is that if "cheap" is the only benefit you can cite, you're probably looking in the wrong direction.

---

This post is written on behalf of BCStrategies, an industry resource for enterprises, vendors, system integrators, and anyone interested in the growing business communications arena. A supplier of objective information on business communications, BCStrategies is supported by an alliance of leading communication industry advisors, analysts, and consultants who have worked in the various segments of the dynamic business communications market.