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Verizon (NYSE:VZ) continues the aggressive expansion of its long-term evolution (LTE) network through the success of its LTE in Rural America program. Headed by Verizon’s executive director of strategic alliances Philip Junker, Verizon is partnering with 17 rural operators across the United States to expand LTE coverage.
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The program is expected to cover 144,000 square miles with 2.7 million points of presence. Rural operators will share access to Verizon’s 700 MHz Upper C Block spectrum, and will use their own towers and other assets to expand the network. This grants Verizon access to rural areas without the company having to invest directly. Once the network is established, the local operators will be able to market the LTE service through their own brands.
Verizon Wireless is at the top of an increasingly tense industry. Verizon Wireless CTO Nicola Palmer has said, “Our 4G LTE network is currently in more markets than all other U.S. wireless providers combined.” This success has rallied smaller carriers that think Verizon and AT&T (NYSE:T) have grown too large.
The Rural Cellular Association recently increased the subscriber benchmark for its members from less than 10 million to less than 80 million, and changed its name to the Competitive Carriers Association. The only two carriers that don’t fall into the new benchmark are Verizon and AT&T. AT&T recently told the CCA to buzz off when they pressed for interoperability on the company’s 700 MHz spectrum holdings.
Verizon and AT&T claim a combined 70 percent of the wireless market. Many members of the CCA see this as a monopoly waiting to happen. As the two giants grow, the need for roaming arrangements with smaller carriers decreases. This effectively hamstrings local operators. CCA president Steven Berry has said, “What do you do when the two largest carriers don’t need strategic partnerships?” Small, competitive carriers lose out.
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