5G residential internet service: what it means for consumers
If there was ever a business ripe for disruption, it’s home internet broadband. And if the promises surrounding the next generation of wireless access called 5G are kept, the legacy companies who now provide wireline-based internet access are in for a bumpy ride.
On Tuesday, Verizon announced that it will bring residential 5G service to the Houston area. In doing so, Verizon will go head-to-head with the
two primary broadband incumbents here, AT&T and Comcast.
That could be just the beginning. Verizon may be first to start selling true 5G service here, but it won’t be alone for long. T-Mobile has also said it wants to sell residential 5G, and it is pitching its proposed merger with Sprint as the best way to get into the game. Chances are, you might see a T-Mobile residential broadband offering in Houston as early as next year.
That would mean Houston residents could end up with a choice of four broadband providers before 2020, with two relying on traditional wired infrastructure, and the other two wireless.
AT&T, which already has a robust cellular business along with its wired services, will offer mobile 5G but could also flip the switch on a residential version.
Houston is lucky to have more than one broadband provider in most of the area, but anyone who has ever shopped for or compared internet services here probably knows the local market could use a good shaking up.
For example: Customers shopping for internet access or cable television services typically find promotional prices that go up after a fixed period, usually a year. Neither AT&T nor Comcast are very transparent on their sites about what the post-promotional pricing is. That information typically is buried in fine print that’s not shown on the main page.
To get to AT&T’s pricing disclosure statement, you must click a hard-to-see, dark-blue-on-black link. Then, AT&T never actually gives you a number. Instead, the fine print reads: “After 12 months, then (sic) prevailing monthly rate applies unless canceled by customer before end of promo period.”
An AT&T spokesman said that because “promotional pricing regularly changes,” the nonpromotional price is disclosed when customers place the order “to avoid confusion.”
Comcast gives you amounts, but you have to do some math to figure it out. At that company’s site, you’re shown a range of potential post-promotion pricing, and if you choose one of their faster speed tiers, you must add a surcharge to come up with the true price range.
There’s no guarantee that Verizon will behave any differently, of course. But T-Mobile is a another story. Its chief executive, John Legere, said even before the Sprint merger was proposed that he wanted to enter and shake up the cable TV business in the same way T-Mobile has upended cellular service practices.
The merger is still a ways off, if regulators allow it to happen at all. But it holds the most promise for bringing about change if Legere stays true to form.
At this point, it’s also important to keep in mind that 5G is, for now, vaporware. It exists only in labs and test scenarios — including at a test site in northwest Harris County — and still has to prove itself commercially.
Verizon CEO-in-waiting Hans Vestberg wasn’t forthcoming with a lot of details about the service during a dog-and-pony event with Mayor Sylvester Turner on Tuesday.
Here’s what’s not yet known:
How fast it will be. Current residential broadband download speeds top out at 1 to 2 gigabits a second. 5G is potentially faster than that, but initial speeds are expected to be in the same range. There’s also no indication about upload speeds, which typically are lower than downloads.
Whether there’s a data cap. Most home internet service offerings have a 1-terabyte data cap, after which customers are charged for additional gigabytes. Both AT&T and Comcast say only a small percentage of its customer base ever exceeds this amount. Mobile internet service, however, is priced based amount of data used. Which model will Verizon choose for its 5G service? It’s coming to homes via wireless, but it’s sold against wired competitors.
How much it will cost. Without the expense of having to string wires to homes, Verizon’s 5G service could undercut wireline competitors at higher speeds. On the other hand, 5G service does require different kinds of transmitters, which in some environments — such as dense urban cores — must be placed close together. That’s not cheap, either.
How well it will work. 5G is actually a stew of different technologies, including the use of multiple radio frequencies. Some of those frequencies don’t easily penetrate buildings, and in some tests have even been thwarted by leafy trees. There are also remarkable promises being made about 5G’s latency, or the delay between the time a user requests data and the time it is delivered. Can those promises be realistically kept in a real-world environment?
We’ll get the answers to these and other questions once Verizon’s service becomes available, sometime before the year is out. At the very least, you can expect shifts in the market, hopefully for the better, as incumbents jockey to respond.