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CandW discuss if Verizon’s 5G bundle can take on cable

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On paper, the Verizon 5G broadband and video bundle sounds very appealing. If 5G delivers as promised, can cable face down the challenge?

Chapter 1: Verizon’s 5G double play bundle (1:30)

Verizon announced its first deployments of 5G broadband service. Verizon 5G home is set to launch in Houston, Indianapolis, Los Angeles, and Sacramento later this year. The introductory package is very competitive:

  • Three months of Verizon 5G home for free
  • Typical broadband speeds of 300 Mbps with peaks to 1 Gbyte and no data cap
  • No installation or equipment charges
  • Three months of YouTube TV service for free
  • A free Apple TV or Chromecast Ultra.

Verizon 5G home costs $50 per month for wireless customers and $70 for non-customers after the trial period is over.

So far, there haven’t been full-scale commercial deployments of 5G home broadband. As well, the bundle seems architected to encourage a lot more Ultra HD streaming, with fast speeds and no data caps. If 5G works as advertised, however, both Will and I think the package is very appealing.

Chapter 2: How Comcast is repositioning video and broadband service (8:20)

Comcast says that pay TV is now playing a supporting role to broadband. As well, the company wants to maintain the profitability of its pay TV service by focusing on the higher-paying customers. Broadband is also being refocused away from speed and price to Wi-Fi coverage and manageability.

Most customers still buy broadband based on speed and price. They may not be interested in Wi-Fi coverage and manageability at all. On the other hand, the Verizon 5G package delivers comparable speed to cable broadband at a very competitive price and could be very enticing. Throwing in YouTube TV for three months may be enough to persuade many to give it a try.

Chapter 3: Comcast versus Verizon in competitive markets (11:40)

Virtual MVPDs are already doing quite well against traditional pay TV services. Combining them with ultra-fast 5G broadband could be a winning combination. However, reliability and quality are very important to people. Without it, 5G won’t be competitive.

Cable did a great job stopping the deployment of fiber to the home. The operators were able to deliver fiber-like performance at a fraction of a cost of laying fiber. The equation is very different for 5G, which requires a fraction of the cost of fiber to deploy.

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