Lead Economist, Communications
Jeff Johnston is lead communications economist in CoBank’s Knowledge Exchange research division. He focuses on identifying emerging technologies, business models, risks and opportunities within the telecommunications industry, and providing strategic analyses to both internal and external stakeholders.
Prior to joining CoBank in 2018, Mr. Johnston was an equity analyst covering the tech, media and telecom sectors. He has also held various senior management positions in the telecommunications industry. Mr. Johnston earned his bachelor’s degree in business administration, accounting and finance from York University and he is also a CFA (Chartered Financial Analyst®) charterholder.
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The feverish pace of M&A activity in the U.S. communications market has seen a considerable slowdown over the last 12 months.
Effects from higher interest rates are permeating rural industries
Providing wireless coverage in rural America has not been a priority for the national wireless operators as the limited market opportunity didn’t justify the cost to provide “urban like” coverage in remote parts of the country.
The war in Ukraine and inflation will remain the two biggest factors for commodity
markets in the first half of 2023.
The Russia-Ukraine war, surging inflation, and an energy crisis joined the COVID-19 pandemic this year as major events defining the operating environment for U.S. companies. We can expect to feel the aftershocks in 2023.
The national wireless operators, most notably Verizon and T-Mobile, have been wreaking havoc on the internet business of cable companies. The wireless operators are looking for new growth opportunities and have set their sights on the home internet market.
Smartphones with satellite connectivity are generating quite the buzz in the wireless
market thanks to recent announcements from industry heavyweights including
Apple, T-Mobile, and Elon Musk’s SpaceX.
Despite ongoing impacts from Russia’s invasion of Ukraine and lingering supply chain
effects from the pandemic, the U.S. economy remains incredibly resilient.
Rural telecommunications are one of the most dynamic markets in the U.S. Here are five notable market-moving developments to watch.
Fears of higher rates and weakening economic conditions
linger over the year’s second half.
Although precision agriculture has been around for more than 25 years, the past decade has introduced advanced computing technologies such as data analytics, artificial intelligence, connected devices, robotics, and automation.
There has always been a valuation gap between public cable and private communication operators that offer internet, cable and phone services. Public equities are exposed to the whims of the stock market which can have a significant impact on valuations
As auto manufacturers pivot their business model away from internal combustion engine vehicles and towards electric vehicles, the stage is being set for millions of self-driving EVs to buzz through the streets.
As we enter the third year of the COVID-19 pandemic, the virus is still in control of the economy.
The communications industry is expected to evolve significantly over the next several years as our work and lives grow increasingly digitized.
Businesses of all sizes and across most industries are wrestling with perhaps the worst supply chain bottlenecks to date
New advancements in wireless technologies and the flood of newly available spectrum are enabling national wireless operators to enter the home broadband market with a fixed wireless access solution.
The long-awaited period of pent-up, exuberant demand is here. And for all the benefits to businesses and consumers, bumps are unavoidable – labor shortages, price inflation, supply chain disruptions, and uncertainty about what a new steady-state economy will look like. They loom large, even as we celebrate a return to normalcy.
The current state of 5G, when rural America can expect true high-speed 5G, and the opportunities that exist for rural operators as 5G is deployed.
Anticipation of a return to normal is in the air. But for the economy and rural industries, there will be no going back to pre-COVID conditions.
With millions of bored consumers waiting out the pandemic at home this past year, 2020 was a tipping point for connected TV on-demand video streaming services, which drove an acceleration in cable cord cutting.
The FCC’s recently-released results for the first round of the Rural Digital Opportunity Fund left many questioning how the commission decided to allocate the funds.
2021 has quickly altered the political and market landscape. And optimism, particularly about the second half of the year, is rising. But to get there, all of us must muddle through for a few months more.
The speed of the economic recovery will largely hinge on the availability, dissemination and reach of COVID-19 vaccines, pushing the expected burst of pent-up consumer demand into the latter half of 2021, according to a comprehensive year-ahead outlook report from CoBank’s Knowledge Exchange division.
As the U.S. and China continue to battle over trade, technology, and intellectual property rights, those living in rural America are getting caught in the middle.
The coronavirus pandemic has now impacted all four quarters of 2020, and seemingly every aspect of life and business.
The abrupt shift in 2020 to working from home and remote learning has significantly increased high-speed data subscriptions, representing a new catalyst for the broadband market.
The FCC recently concluded its CBRS spectrum auction and as expected, there was a wide range of winning bidders.
T-Mobile’s efforts to expand rural coverage should be a tailwind for rural tower operators as it’s likely the company will use existing towers in remote parts of the country rather than building its own.
Over the past four months, every rural industry has grappled with how to adjust its business to remain relevant and sustainable in the pandemic. Agricultural supply chains have been massively disrupted and lost revenue. Water and power suppliers have adapted as commercial and industrial customers went dark and demand shifted to residential customers. And the communications industry is seizing a moment when home broadband access has become vividly essential, to help expand access to everyone, everywhere.
On July 23, 2020, the Federal Communications Commission (FCC) will start its highly anticipated CBRS auction for the licensed portion of the spectrum band.
Satellite-based internet has been around for several years, but for the most part it has failed to gain traction due to slow data speeds and pricey rate plans with data caps.
Numerous rural operators are going above and beyond to keep their communities connected. However, in doing so, these operators are taking on increased cash flow risks.
The primary challenge to bridging the digital divide is cost. In many rural markets there simply aren’t enough residents to justify the capital and operating expenditures needed to run a profitable network.
Broadband operators are seeing a 20-40% increase in data traffic where a shelter in place order has been issued. This is putting undue stress on rural communication networks.
The beginning of a new quarter finds us in unparalleled times – a pandemic ravaging the world, the U.S. economy in shutdown, millions of Americans out of work, and financial markets in turmoil.
The coronavirus and the measures to prevent its spread are wreaking havoc for all Americans. But for those living in rural America, the disruption is even worse.
The verdict is in and a federal judge has cleared the way for Sprint and T-Mobile to merge. There are three main takeaways for rural America.
As Sprint and T-Mobile forge ahead with their merger, a number of states are standing in the way citing anti-trust concerns, among other factors.
The fourth quarter is ending with much more optimism on trade and the economy compared to how it began.
The U.S. rural economy will continue to face headwinds in 2020 and is expected to underperform relative to the economy of urban America.
Mergers & acquisition activity in the telecom market has driven an explosion in cloud computing, consumers’ insatiable demand for data, and new technologies.
Consumer adoption of over-the-top video streaming services, coupled with rising programming costs, have created significant headwinds for traditional pay-TV operators.
Uncertainty over trade policy, weather and African Swine Fever dominated agricultural markets last quarter.
Hype is reaching fever pitch for 5G (fifth-generation cellular wireless service), which has been touted as a quantum leap for wireless internet speed. However, operators’ go-to-market strategies are unclear.
Broadband partnerships between Rural Local Exchange Carriers (RLEC) and Electric Distribution Cooperatives (EDs) are uncommon, but when done right, can benefit all involved.
Global economic growth continues to slide, as tariffs drag on global trade and manufacturing.
Rural operators will be the ones hurt the most by the executive order, which will likely soon ban U.S. telecom operators from buying Huawei-made telecom equipment.
Citizens Broadband Radio Service, or CBRS, has introduced a new spectrum sharing business model that will improve broadband coverage in rural America.
As organizations look for cost-effective ways to manage their IT operations, the hybrid cloud offers an attractive alternative to on-premise data centers.
U.S. agriculture is poised for serious challenges for the remainder of 2019.
Wireless operator margins are being pressured and cost management is under the microscope as the mobile market matures. As a result, the legacy tower business model with its annual escalators and amendment fees are becoming a problem for operators.
As wireless carriers work towards building their 5G networks, many of them have yet to finalize their commercial strategy and business case, according to a report from McKinsey & Company.
Investments in U.S. fiber networks have become an area of focus for infrastructure funds looking to take advantage of the industry’s secular tailwinds and strategic buyers who want to diversify their business and/or gain operating leverage.
The U.S. administration is reportedly close to issuing an executive order preventing U.S. companies from buying telecom equipment from Chinese manufacturers.
The U.S. economy is still performing well by most key measures. However, consumers, investors, companies and other market participants have become more wary about the near-term future with seemingly good reason.
Agriculture and its farmer cooperatives will face a challenging environment in 2019. Commodity markets have steadied, but resolution of ongoing trade disputes and completion of recently concluded trade negotiations will be critical to restoring optimism for the year ahead.
Many rural local exchange carriers, or LECs, face secular headwinds in their core business thanks to declining regulated revenues. These revenues have been under pressure for years given a variety of factors, particularly with the shift away from landline service in favor of wireless.
FirstNet will enable rural wireless operators to evolve their business model with AT&T to a co-locate/backhaul structure versus just a roaming relationship, which opens the door to new long-term recurring revenue opportunities.
As rural telecom operators look for cost-effective ways to bridge the digital divide, 5G FWA has been identified as a potential solution. The issues deploying widespread fiber networks in rural markets are numerous and well documented, which has led to an estimated 25 million consumers without broadband access.