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A New Rural Broadband Product?

Verizon announced a new wireless data product that raises a few questions for me. Verizon announced the ‘LTE Home Internet’ product on this web page. The product is easily explained. Verizon will be delivering unlimited data using the cellular 4G LTE network. Customers must buy a receiver from Verizon for $240, but the company is offering a $10 discount for 24-months which returns the cost of the box over two years. The product is $40 per month for a household that is buying a Verizon cellular product that costs at least $30 per month. Non-Verizon wireless customers pay $60 per month. There is free tech support for setup issues for 30-days, implying that tech support will entail a fee after that.

Verizon touts the product as delivering 25 Mbps download speeds, with bursts as high as 50 Mbps. Verizon is launching the product in three markets – Savannah, GA, Springfield, MO, and the Tri-cities area at the area near the borders of Tennessee, Virginia, and Kentucky.

The first question raised is if this product is intended to replace Verizon’s rural hotspot product, marketed as Verizon Jetpack. The Verizon announcement says, “Verizon will expand home Internet access to customers outside the Fios and 5G Home footprints, expanding home connectivity options to rural areas.”, which implies that this is a replacement for the current rural 4G hotspot product. If so, this would be a drastic repricing for rural LTE broadband.

The Jetpack hotspot is widely used in rural America where there are no other broadband alternatives. From what I can see, the Verizon hotspot is the most expensive broadband in the country and is billed at data rates similar to normal cellular plans. The Jetpack product has four available pricing tiers based upon the monthly data allowance. The 10 GB plan is $60, the 20 GB plan is $90, the 30 GB plan is $120, and the 40 GB plan is $150. The real price killer is that Verizon bills additional gigabytes at $10 each. I’ve talked to rural households that spend $500 or per month or more for the hotspot plan.

The release of the new product caught the industry by surprise and there was little or no buzz that this was coming. The big question that those living in rural America will have is if Verizon will offer this as an alternative to the Jetpack product. Is Verizon planning to move customers from plans that cost hundreds of dollars per month to a plan that offers unlimited data for $40 to $60? If so, then this is great news for rural America.

My second question concerns data speeds. Verizon advertises the existing Jetpack product as having from 5 to 12 Mbps download and 2 to 5 Mbps upload. However, the current plan comes with a warning that the product only works where Verizon has a ‘strong’ data signal. I’ve talked to a number of households that say that the Jetpack product is only delivering a few Mbps. Rural LTE data speeds are reliant upon two factors – how close a customer is to a cell tower, and the underlying strength of the broadband feeding the tower.

I wonder if the new product will be any faster? There is a chance that it can be faster if the new device utilizes more frequency bands than the old hotspot receiver. But cellular speeds, in general, get weaker with distance from a cellular tower, and folks that are more than a mile or two from a tower are not likely to get the touted 25 Mbps speeds on the new product.

The cynic in me suspects that Verizon will only activate this product near markets where they have faster broadband products. This would be a good fill-in product for low-bandwidth homes in neighborhoods served by FiOS or the new fiber-to-the-curb FWA product. This is not a bad broadband product for a home that only reads emails and watches a single stream of video – but this product would bog down quickly if used to support multiple simultaneous users.

I doubt that the average urban broadband customer appreciates the misery of homes using the Jetpack hotspot. Data use is metered and it cost $10 of broadband to watch a movie. Families with kids using the hotspot have a constant fight to keep them off the Internet. I hope my gut feeling is wrong and that Verizon will introduce this everywhere and toss out the hotspot product. Even if this product doesn’t bring faster data speeds to rural homes, the pricing and the ability to use unlimited data would be a welcome relief to homes using the Jetpack hotspot. It’s possible that this product is Verizon’s response to T-Mobile’s promised rural 5G product, but we’ll have to wait to see where this is made available before getting too excited about it.

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Current News Technology

Scratching My Head Over Gigabit Wireless

Over the last few weeks I have seen numerous announcements of companies that plan to deliver gigabit wireless speeds using unlicensed spectrum. For example, RST announced plans to deliver gigabit wireless all over the state of North Carolina. Vivant announced plans to do the same in Utah. And I just scratch my head at these claims.

These networks plan to use the 5 GHz portion of the unlicensed spectrum that we have all come to collectively call WiFi. And these firms will be using equipment that meets the new WiFi standard of 802.11ac. That technology has the very unfortunate common name of gigabit WiFi, surely coined by some marketing guru. I say unfortunate, because in real life it isn’t going to deliver speeds anywhere near to a gigabit. There are two ways to deploy this technology to multiple customers, either through hotspots like they have at Starbucks or on a point-to-multipoint basis. Let’s look at the actual performance of 802.11ac in these two cases.

There is no doubt that an 802.11ac WiFi hotspot is going to perform better than the current hotspots that use 802.11n. But how much better in reality? A number of manufacturers have tested the new technology in a busy environment, and with multiple users the new 80211.ac looks to be between 50% and 100% better than the older 802.11n standard. That is impressive, but that is nowhere near to gigabit speeds.

But let’s look deeper at the technology. One of the biggest improvements in the technology is that the transmitters can bond multiple WiFi channels to make one data path up to one 160 MHz channel. The downside to this is that there are only five channels in the 5 GHz range and so only a tiny handful of devices can use that much spectrum at the same time. When there are multiple users the channel size automatically steps down until it ends up at the same 40 MHz channels as 802.11n.

The most important characteristic of 5 GHz in this application is how fast the spectrum dies with distance. In a recent test with a Galaxy S4 smartphone, the phone could get 238 Mbps at 15 feet, 193 Mbps at 75 feet, 154 Mbps at 150 feet and very little at 300 feet. This makes the spectrum ideal for inside applications, but an outdoor hotspot isn’t going to carry very far.

So why do they call this gigabit WiFi if the speeds above are all that you can get? The answer is that the hotspot technology can include something called beamforming and can combine multiple data paths to a device (assuming that the device has multiple receiving antennas). In theory one 160 MHz channel can deliver 433 Mbps. However, in the real world there are overheads in the data path and about the fastest speed that has been achieved in a lab is about 310 Mbps. Combine three of those (the most that can be combine), and a device that is right next to the hotspot could get 900 Mbps. But again, the speeds listed above for the Galaxy S4 test are more representative of the speeds that can be obtained in a relatively empty environment. Put a bunch of users in the rooms and the speeds drop from there.

But when companies talk about delivering rural wireless they are not talking about hotspots, but about point-to-multipoint networks. How does this spectrum do on those networks? When designing a point-to-point network the engineer has two choices. They can open up the spectrum to deliver the most bandwidth possible. But if you do that, then the point-to-multipoint network won’t do any better than the hotspot. Or, through techniques known as wave shaping, they can design the whole system to maximize the bandwidth at the furthest point in the network. In the case of 5 GHz, about the best that can be achieved is to deliver just under 40 Mbps to 3 miles. You can get a larger throughput if you shorten that to one or two miles, but anybody who builds a tower wants to go as far as they can reach, and so 3 miles is the likely networks that will be built.

However, once you engineer for the furthest point, that is then the same amount of bandwidth that can be delivered anywhere, even right next to the transmitter. Further, that 40 Mbps is total bandwidth and that has to be divided into an upload and download path. This makes a product like 35 Mbps download and 5 Mbps upload a possibility for rural areas.

If this is brought to an area that has no broadband it is a pretty awesome product. But this is nowhere near the bandwidth that can be delivered with fiber, or even with cable modems. It’s a nice rural solution, but one that is going to feel really tiny five years from now when homes are looking for 100 Mbps speeds at a minimum.

So it’s unfortunate that these companies are touting gigabit wireless. This technology only has this name because it’s theoretically possible in a lab environment to get that much output to one device. But it creates a really terrible public expectation to talk about selling gigabit wireless and then delivering 35 Mbps, or 1/28th of a gigabit.