Before talking about the market, I’d like to first talk about rural cellular coverage today. In case you’ve never seen it, here is the FCC’s map showing LTE coverage for voice and data for AT&T, T-Mobile, Verizon, and U.S. Cellular. This map has been created from reports made to the FCC through the same Form 477 process that has resulted in lousy broadband coverage maps. Everything I read says that the cellular coverage maps suffer from the same kinds of problems due to overstated claims by the cellular carriers. I live in Asheville, NC, and I think the claimed coverage of each carrier is overstated, at least around here in the mountains. I happen to use AT&T, and I know of several sizable dead spots that are not reflected on this map. Being a telecom guy, I ask the coverage question a lot, and I’m told of similar rural holes for coverage for every carrier. But most of you will find the map to be interesting because it shows what the cellular carriers claim as coverage in your area.
T-Mobile says it’s going to start aggressively marketing in rural areas. To pursue that goal, the company will be opening 200 new retail stores. This is on top of the retail locations it picked up from the Sprint merger. T-Mobile says it will soon have outlets using the Metro brand name in 2.300 Walmarts. T-Mobile says that it is still on track to meet its goal of offering fixed cellular broadband to 97% of households by the end of 2022. That goal seems aggressive because of T-Mobile’s rural coverage today. Referring back to the FCC map, in my part of the world, T-Mobile has far less existing coverage than AT&T or Verizon.
One of the interesting aspects of T-Mobile’s rural coverage is that the company will be using 600 MHz spectrum in rural areas. That spectrum carries a lot farther than the traditional cellular spectrum, but the lower spectrum also carries less broadband. It’s going to be interesting to see the broadband speeds the company can deliver more than a few miles from a rural cell site.
AT&T also says it’s in the process of boosting rural cellular coverage. Much of its new coverage will be coming from new cell sites that are being activated at towers constructed as part of AT&T’s nationwide roll-out of FirstNet – the nationwide public safety network. The federal funding that is covering the cost of deploying public safety towers is giving AT&T new platforms for cellular coverage. AT&T also uses a relatively low spectrum frequency at 700 MHz that travels farther in a rural setting than its traditional spectrum. A lot of AT&T’s rural coverage comes from its popular Cricket Wireless brand that has a lot of stores in smaller markets. The only downside of Cricket is that it’s widely rumored that AT&T cell sites supposedly give priority to AT&T-branded customers over the lower-priced Cricket customers.
Verizon supposedly has the best rural coverage today of the major carriers, which came as a result of the purchase in 2009 of Alltel. The coverage was enhanced further by the 2020 purchase of TracFone. Verizon announced recently that it is shutting down the 2G and 3G networks operated by TracPhone, which is causing a lot of consternation in rural America. TracFone was known as the last network that was friendly to older flip phones.
What does all of this mean for rural cellphone coverage and competition? The expansion of T-Mobile into rural markets should bring a new competitor to many markets where perhaps only one carrier was available before. The use of the 600 MHz and 700 MHz should expand rural cellular broadband coverage, but we’ll have to wait and see what those spectrum bands mean in terms of broadband speeds. Cutting back on TracFone coverage will hurt some rural pockets where the companies might have been the only cellular option.