Verizon’s Sampath: Hefty C-band investments paying off

How important is the C-band spectrum that Verizon continues to roll out in markets across the country?

One of the metrics that Sowmyanarayan Sampath, CEO of the Verizon Consumer Group, tracks on a weekly basis is churn in C-band vs. non-C-band markets. “We tend to do much better, lower churn in C-band markets,” he said.

In addition, they tend to get more people taking premium plans in markets where they’ve deployed C-band spectrum, which is considered mid-band spectrum. “More revenue, less churn makes for a very happy business case,” he said during a Wednesday appearance at the Bank of America investor conference alongside Verizon CFO Tony Skiadas.

“We feel more comfortable about what we spent than we did when we actually started the project,” Sampath commented. “The customer experience is a good thing.”

Verizon spent more than $52 billion, including incentive payments and clearing costs, for C-band (3.7 GHz) licenses at auction in 2021. But the spectrum wasn’t immediately available because satellite operators needed to move out. Thanks to incentive payment plans, Verizon was able to access all its C-band spectrum four months ahead of time.

Still, that doesn’t mean all that C-band is immediately available for customers. “The network team still has to build out the network … There’s still a couple of years of work that Joe [Russo] and the network team have to do to continue to build out the C-band network,” Skiadas said. “But we’re at a healthy pace.”

Verizon is playing catch-up in the mid-band 5G deployment as T-Mobile acquired 2.5 GHz spectrum in the Sprint acquisition and expects to cover 300 million people with Ultra Capacity 5G by the end of 2023. Verizon currently offers C-band to more than 222 million people.  

Making progress in consumer unit

Sampath was leading Verizon’s Business Group until March, when he was tapped to head the Consumer Group, which had not been performing as well as the business unit. Verizon has been losing wireless consumer customers for several quarters. Last week, Verizon CEO Hans Vestberg said the new myPlan rate plans coupled with the restructuring of the Consumer Group is slowly resulting in some operational improvements.

Sampath said he’s happy with the progress in the last couple of months and they’ve done “an incredible amount” of transformation. The introduction of myPlan, which allow customers to customize their plans, is a “big win” for Verizon, he said.

In addition, they changed the sales structure to be more locally focused with six markets and a lot of autonomy in the field as well as local marketing and activation. They also moved back to an individual sales compensation model and executed on upping prices, including the most recent $10 increase across the board for its fixed wireless access (FWA) internet offerings.