When Will Verizon Invest in Making LTE Services a Reality?

In listening to a replay of Tuesday's Verizon/Verizon Wireless (VZ) year-end earnings conference call, I did hear some more optimism from company execs about launching "commercial" deployments of Long Term Evolution services by the second half of 2010 -- not as aggressive as once thought, but still well ahead of stated LTE plans from other big national carriers.

But sifting through the financial data, I wasn't able to quickly find any evidence that Verizon is starting to spend on infrastructure to make LTE services a reality, at least in any widespread fashion. If you wade through the financial-figures (.pdf), you find that in 2008, Verizon spent roughly the same on domestic wireless capex as it did in 2007 -- $6.510 billion in 2008, vs. $6.503 billion in 2007 -- which says to me that the heavy spending for LTE isn't happening yet.

Now, granted, big cellular providers like Verizon may have some economies of scale (like towers and equipment facilities) already in place, but LTE is not going to be a simple software upgrade to the company's current 3G system. It is going to require new network infrastructure gear for the IP-based backbone and new antennas for starters, stuff that is likely to show as a capex delta over what appears to be the yearly spending norm for the company's existing networks.

Since the spending isn't broken down in any granular fashion it's hard to tell if LTE spending is already occurring, but the sameness of the numbers from 2007 to 2008 does seem to show that the extra billions that are probably necessary for any big LTE deployment aren't being spent yet. Something to watch for (and ask about) in future earnings calls!

For the record, Verizon COO Denny Strigl did say Tuesday that Verizon was still planning for "market trials" of LTE late in 2009, with some "commercial availability" sometime "in the first half" of 2010. Unfortunately, none of the analysts on the call asked any more pointed questions, such as whether or not Verizon has enough spectrum to offer appreciably faster wireless data services, or when LTE devices might be available since the standard isn't quite baked yet.

These are just some questions you might want to ask and answer before claiming that Verizon's slideware LTE network is keeping the fire raging under Clearwire's (CLWR) WiMax plans. Again, maybe these are questions we'll hear more answers to as Verizon gets closer to its current LTE deployment plans.

One good point for deployers of all stripes was Verizon's continued growth in wireless data revenues, even in the face of a down down down economy. And it looks like wireless data is up at AT&T (T) as well. So maybe it's true, that the wireless phone service will be the last thing broadband consumers will give up. We will take the financial rays of sunshine where we can, these days.

Comments

[curiousreader]

No negative response from Geddy yet???? He seems to come in to every CLWR discussion as the designated CLWR-hater. (bet they fired him, ha!) Last I checked under his comments he has had dozens and dozens of anti-CLWR comments on almsot every related post... i'll give it a few more hours...

2009 Jan 29 04:24 PM

[Geddy]

Here it is bud! Nah, never worked for Clearwire as I've mentioned in numerous posts (I thought you read my comments?). I do admit I've had some family members get their service & were extremely dissappointed...thus my reason for "spanking" them a bit. If you look back at my comments, haven't the predictions come true about Clearwire?


On Jan 29 04:24 PM curiousreader wrote:

> No negative response from Geddy yet???? He seems to come in to every
> CLWR discussion as the designated CLWR-hater. (bet they fired him,
> ha!) Last I checked under his comments he has had dozens and dozens
> of anti-CLWR comments on almsot every related post... i'll give it
> a few more hours...

2009 Jan 30 10:23 AM

[robert1234]

Verizon knows it has already blown it. They are to late with a technology that ultimately isn't going to cut it and it's becoming apparent to all. Clearwire, like it or not, is where it's at as of now. Unfortunately, their service people really suck big time and that's holding it back significantly. If Clearwite can't get that together, they will lose out and only then will LTE have a chance. I'm stunned, frankly, that Clearwire's tech service and help lines are literally god-awful at such a critical time. Here's hoping they can get it together SOON.

2009 Feb 05 04:41 AM

[Geddy]

How do you figure Verizon has blown it???? Too late with a technology that won't cut it?? Good God dude, where have you been hiding? Have you not read that EVERY major carrier (Sprint doesn't count as they won't be company much longer anyway) is LTE? Try again...


On Feb 05 04:41 AM robert1234 wrote:

> Verizon knows it has already blown it. They are to late with a technology
> that ultimately isn't going to cut it and it's becoming apparent
> to all. Clearwire, like it or not, is where it's at as of now. Unfortunately,
> their service people really suck big time and that's holding it back
> significantly. If Clearwite can't get that together, they will lose
> out and only then will LTE have a chance. I'm stunned, frankly, that
> Clearwire's tech service and help lines are literally god-awful at
> such a critical time. Here's hoping they can get it together SOON.

2009 Feb 21 07:55 PM