UScellular poised for big growth in FWA

Dec 15, 2023

NEW ORLEANS – UScellular finished the first quarter of 2023 with 87,000 fixed wireless access (FWA) subscribers. But, according to both company officials and financial analysts, UScellular is just getting started.

"It's been super successful," said Mike Irizarry, UScellular's CTO, during a keynote presentation here at the Connect X tradeshow. He added: "We don't have any [network] capacity issues."

Several analysts largely agreed with Irizarry's cheery outlook.

"We think UScellular's FWA product will become a very meaningful business line," wrote the financial analysts at Raymond James in a recent note to investors.

They noted that UScellular currently supplies FWA to around 0.7% of the 13 million potential customers in its coverage footprint. If the company manages to increase that penetration rate to around 8% – a number T-Mobile hit this year with its own FWA offering – UScelllular could count up to 1 million FWA customers.

That could represent a troubling issue for the DSL and cable providers in its coverage area.

"Similar to its larger peers, fixed wireless appears to have sustained momentum throughout the course of 2023 which should enable UScellular to build share, even at smaller numbers," added the financial analysts at Wells Fargo in their own recent note to investors. UScellular counts around 5 million total mobile customers.

For its part, UScellular expects to grow its FWA subscriber base to around 100,000 customers later this year. That's roughly the same time it expects to begin supercharging its FWA business with the addition of midband 5G spectrum, including C-band and 3.45GHz. UScellular's FWA business to date has been working only on its lowband and highband, millimeter wave (mmWave) spectrum holdings.

Importantly, both T-Mobile and Verizon have largely based their FWA successes on the network capacity derived from their deployment of their own midband spectrum holdings.

Bundling mobile, FWA and fiber

UScellular announced this week that bundling will be one of the sales tactics it plans to use to push its offerings. Specifically, the company said it would begin selling fiber services from TDS, its parent company, in 12 of its retail stores across Wisconsin. "This allows UScellular to identify the best solution for each customer, while also connecting the first-class service and experience both companies provide. This is the first time the companies have come together in this way to serve customers," UScellular wrote in its release.

The company also said it would offer discounts on its mobile service to customers who sign up for either its FWA or fiber home Internet service.

In response to questions from Light Reading, a UScellular representative said UScellular's mobile customers would get a $10- or $20-per-month discount if they also sign up for either wired (TDS) or wireless (UScellular) home Internet services.

The company's strategy is noteworthy considering other big operators are also working to bundle different kinds of services. For example, both T-Mobile and Verizon offer discounts to customers who sign up for both FWA and mobile services. In the meantime, Charter Communications and Altice USA have both released their own bundles of mobile and home Internet services.

Looking to the FWA future

Irizarry, UScellular's CTO, said the company currently offers FWA customer premises equipment (CPE) from Casa Systems and Inseego. He said Nokia and Ericsson are supplying the network equipment for the company's midband FWA service, and Samsung is supplying the company's mmWave FWA network equipment.

But he said the company is currently testing new approaches to its FWA offering. Specifically, he said UScellular is looking at an external FWA receiver that customers can install themselves on the outside of their homes. That's important, he said, because external receivers can provide up to four times the capacity of receivers that are installed inside customers' homes. Irizarry added, though, that external receivers installed by customers might not be as efficient as external receivers installed by professional technicians. Further, "some customers don't like the unit on the roof, and it's not a simple install," he said.

UScellular isn't the only FWA provider eyeing the prospect of externally installed receivers. T-Mobile officials have also discussed the potential for such external receivers.

However, FWA providers like T-Mobile and Verizon generally prefer customer-installed receivers that sit inside customers' homes because they're easier to sell.

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� Mike Dano, Editorial Director, 5G & Mobile Strategies, Light Reading | @mikeddano