Wednesday, November 13, 2013

CFO admits Verizon Wireless network is straining to sustain its LTE users

Being no. one to some sort of milestone is usually good, but not always. In the case of Verizon Wireless, its lead in terms of LTE is stretching the limits of its network, Cnet reported on Tuesday.

When AT&T was the exclusive seller of the iPhone, the nation's no. two wireless carrier was blasted for dropped calls, slow data, and more. Verizon, meanwhile, touted its network as the nation's most reliable, but that may not longer be the case. All that being said, Verizon CFO Fran Shammo admitted on Thursday that the fact that it rolled out LTE first -- in Dec. 2010 -- was starting to hamper the company's quality of service.

Speaking at an investor conference, Shammo said:
There are certain pockets where we're absolutely going to experience that down tick from the LTE network down to 3G because of capacity constraints.
In addition, Verizon's form of 3G -- CDMA -- is very slow when compared to AT&T's version of 3G.

One problem for Verizon is that its LTE customers use about double the data of its 3G customers. LTE customers make up about a third of the company's customer base, yet they consume about 64 percent of its network traffic.

That percentage is an average, though. Shammo said that in larger cities, that percentage is likely higher.

Verizon Wireless appears to have a plan in place, moving forward, though. The company has increased its capital expenditures to $500 million this year. Also, as we reported earlier, the network is nearing a rollout of its AWS or Advanced Wireless Service spectrum.

Timing-wise, it appears the rollout and fix will arrive in the next two months. Shammo said,
By the end of this year you are going to see all those issues dissipate.
Hopefully this will happen before more many LTE users get a chance to see that 3G icon -- as well as its correspondingly slow data rate -- appear on their phones or tablets.


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