The announcements confirm it: Verizon Communications (NYSE:VZ) is launched on a growth path. Here’s the news and why it’s important…
4G: The catalyst for growth prospects
Verizon’s press release explains the company’s actions, including a list of the cities and airports with 4G coverage as of Sunday: “Verizon Wireless Launches The World’s Largest 4G LTE Wireless Network On Dec. 5”
The Wall Street Journal lays out Verizon’s 4G strategy, including it’s competitive pricing and expansion plans: “Verizon to Sell 4G Plan for Less Than 3G” (December 2). Notice Verizon is not waiting for the smartphone availability, but is getting a jump start by focusing on the heavy use “road warriors” and their laptops.
FCC sets stage (#1): Airwaves reallocation from broadcast to wireless
By increasing the airwaves available for wireless usage, the FCC is ensuring that the growth will not be hamstrung by an airwave bottleneck: “FCC proposes wireless use of broadcast airwaves” (Reuters, December 1).
FCC sets stage (#2): Differential pricing
Differential pricing took an important step forward, providing a rational (and profitable) basis for supporting the coming heavy usage: “FCC Chief Backs Usage-Based Broadband Pricing” (The Wall Street Journal, December 2).
Hooking onto Apple’s growth
An unconfirmed rumor in MacRumors.com is that Apple (NASDAQ:AAPL) is testing a 4G iPad on Verizon’s system. Whether true or not, it’s likely only a matter of time before Apple has reconfigured its products to take advantage of 4G’s high speed (about ten times 3G) and Verizon’s expanding coverage (planned to match today’s widespread 3G availability by 2013).
So… All the parts are coming together – and fast. Before we know it, the January 6-9 International Consumer Electronics Show will be upon us, with its dazzling announcements of new products, including soon-to-be “must have” 4G products.
(At the show Verizon will take center stage among telecommunications firms, with “Verizon's Ivan Seidenberg to deliver opening keynote address at the 2011 International CES: Seidenberg’s CES Keynote to Highlight Company’s Vision for its LTE 4G Wireless Technology.”)
Disclosure: Client positions: Long VZ and AAPL