The U.S. wireless business is in a funk, but 2022 should be a blockbuster year — Lowenstein

Mark Lowenstein

Is it just me, or are we in a bit of a funk in the U.S. wireless business? Yes, the first half performance numbers from the MNOs and cable were pretty solid, but 2021 has been pretty lacking in major new service announcements, pricing moves, or competitive drama. This thought, which has been brewing in my mind for a while, was reinforced during the recent Tokyo Olympics where we were treated to a copious number of ads from Verizon, AT&T and T-Mobile. And I have to say that these commercials were uniformly bland and boring. Seriously, watch them. They made me almost pine for the return of John Legere or the Fake News days of "5G Evolution."

To be fair, 2020 was an action-packed year for the industry: two spectrum auctions; the approval of the T-Mobile/Sprint merger; Verizon’s announcement of plans to acquire TracFone; introduction of the 5G iPhone; the drama around China; and of course the challenges the operators, and the industry, faced navigating Covid.

So it’s almost understandable that the industry has taken a sort of collective breather so far in 2021. It’s been a year of blocking and tackling. The major MNOs are proceeding with their 5G deployments at a steady pace, which, in the case of AT&T and Verizon, involves a lot of prepping for their C-Band A-block deployments.

It’s also been a busy year for the CFO suites of the operators, as they figure out how to pay for all that spectrum they bought (and are planning on buying), and then, consequently, for the 5G infrastructure they’ll have to deploy on that spectrum. AT&T and Verizon accountants have been especially busy, as they’ve spent most of 2021 figuring out how to undo their ill-advised foray into media (AOL, Yahoo, DirecTV, Time Warner, etc.).

From the standpoint of the consumer, it’s been a pretty uninspiring year. There have been no major pricing moves by the operators. The 5G rollout continues, but it’s mainly a bunch of small steps, rather than major leaps in capability, coverage, or capacity. And we haven’t yet seen the types of innovative 5G services or apps that have been hyped.

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Things have been a bit more interesting on the enterprise side. There’s been a steady drumbeat of private wireless network announcements. The involvement of the hyperscalers, deployment of mobile edge computing, and maturation of open RAN portends to some important changes we’ll see this decade in network architecture, industry economics and the competitive landscape.

2022 looks more exciting

If 2021 ends up being sort of a meh year, there’s a lot of change in the wind for 2022.

First, the 3.45-3.55 GHz auction will start in October, and will be the last major spectrum auction for some time.

During the first quarter of 2022, we should see some initial C-band services from AT&T and Verizon, which will boost 5G coverage and capacity, and deliver game-changing 5G speeds to a much broader swath of the population than today’s mmWave hotspots. Also, some of the 3GPP Release 16 features, such as URLLC, will become commercially available, enabling some exciting services and applications leveraging low latency capabilities.

RELATED: FCC sets October start date for 3.45 GHz auction

The competitive landscape will also heat up in 2022. We expect the Verizon acquisition of TracFone to be approved and then completed. This could catalyze a reinvigoration and reshaping of the prepaid sector. Dish is also on track to launch its first market by the end of 2021, with more to come in 2022. It’s safe to say that its go-to-market will be unconventional, so that should be interesting.

I’m also expecting some changes in the wholesale/MVNO landscape. With all the new capacity coming online over the next couple of years, wholesale wireless is going to transition from its historic role as a seller’s market into a buyer’s market. It’s likely that cable will seek to reduce its dependence on Verizon. And, Dish needs to secure some substantial wholesale business to start leveraging all that capacity that it's going to be deploying. We could see the entry of some new brand into the business as an MVNO.

Finally, assuming passage of the infrastructure bill by Congress, billions of dollars are going to be available for broadband initiatives. This will help pay for more fiber builds and conventional fixed broadband infrastructure, to be sure. But wireless should figure prominently as well, in the form of 5G capacity, fixed wireless access (FWA), and satellite-based services such as SpaceX's Starlink.

So even if wireless in 2021 has been devoid of a lot of excitement, fasten your seatbelts for what is likely to be an eventful 2022.

Mark Lowenstein, a leading industry analyst, consultant, and commentator, is managing director of Mobile Ecosystem. Click here to subscribe to his free Lens on Wireless monthly newsletter, or follow him on Twitter at @marklowenstein.

Industry Voices are opinion columns written by outside contributors—often industry experts or analysts—who are invited to the conversation by FierceWireless staff. They do not represent the opinions of FierceWireless.