5G Fixed Wireless: Is It Really a Solution to Help Bridge the Digital Divide?

Key Points

• As Verizon begins deploying its 5G fixed wireless networks (5G FWA) in urban and suburban markets, we’ve grown skeptical about how successful they will be in taking share from the incumbent broadband providers. This could be problematic for rural operators as they look to 5G FWA to bridge the digital divide.
• We see issues related to site acquisition, high CPE/installation costs, spectrum propagation, competition, and the capital required to build the networks as significant headwinds for 5G FWA.
• The 5G FWA ecosystem depends on investments made by tier-one carriers and if their commitment wanes, it could leave WISPs and cable operators that are looking to deploy the technology with fewer options and higher costs.
• Conversely, if 5G FWA fails to live up to the hype, it could be viewed as a positive for some rural cable operators and RLECs as it would increase the entry barriers for new market entrants.
• We see these issues, and the uncertainty around new low-band spectrum, as impediments to widespread 5G FWA adoption in rural America, but acknowledge the technology is in its infancy, and many unknowns exist.

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