Operators can utilise spare capacity on their mobile networks to offer FWA services and increase their presence in fixed broadband markets
Despite fixed wireless access (FWA) revenues only accounting for 4% of fixed broadband connections worldwide in 2027, granular geographical targeting in support of fibre-to-the-premises (FTTP) initiatives can still be disruptive.
Analysys Mason’s “Fixed-wireless access strategies: six operator case studies and analysis”, which is based on interviews with FWA providers, shows that operators have developed strategies for FWA that support their fibre-to-the-premises (FTTP) initiatives and can help them to target specific areas where FWA can be disruptive. The business case for FWA is strongly influenced by geographical factors.
For example, T-Mobile USA and Verizon reached 1.9 million and 4.8 million FWA customers, respectively, in 4Q 2023 after launching FWA services in 2021. Report author analyst Oliver Bruff said operators like Saudi Arabia’s Mobily has used FWA is a stepping-stone technology for FTTP. And while customers will churn when FTTP arrives, Bruff said operators using FWA as a “beachhead” strategy, can quickly upgrade existing FWA customers as they roll out their own fibre – a tactic being used by Vodafone UK.
“Data from Analysys Mason’s annual survey of 18 000 consumers suggests that this is a viable strategy,” he said. “FWA respondents were more likely to report intending to change their plan while remaining with their existing provider than customers that took FWA over wireline technologies (for example, FTTP, DOCSIS or DSL).”
Why granular?
Operators need to strike a balance given that the average traffic volume for FWA customers was 10 to 20 times that of handset customers. “This poses a problem for operators. FWA customers can reduce mobile handset customers’ quality of experience (QoE) if network performance is reduced by traffic from FWA. It can also lead to revenue cannibalisation if operators onboard a small number of FWA customers instead of a large number of handset customers,” said Bruff.
One obvious option is to invest in additional network capacity. However, the cost of expanding mobile network capacity for FWA services is often greater than simply purchasing access to wholesale FTTP networks.
As a result, operators strategically target areas where there is spare capacity on their network, rather than investing in capacity specifically for FWA. “T-Mobile USA, for example, forecasts traffic at individual base stations in order to plan the number of 5G FWA users that it can support at each location without hindering network performance,” said Bruff. “Operators that have historically been able to offer FWA services without geographical granularity, such as Mobily, will develop a more-granular approach to FWA as they approach maximum network capacity.”
Network insights
Operators can generate savings when marketing and selling FWA by improving the efficiency with which they gain insights from their networks. Operators that plan to maintain a long-term FWA subscriber base, rather than use it as a stepping stone to FTTP, will benefit the most from investing in this process specifically for FWA.
“Telekom Slovenije, for example, has automated the process by which sales agents are informed about available services at customers’ addresses. Sales agents are automatically informed about the availability of 4G or 5G FWA versus FTTP services at customers’ addresses,” said Bruff. “This is the best approach for Telekom Slovenije, given that it expects to maintain 7% of its fixed broadband subscriber base on FWA in the long term.”
In contrast, he said, Vodafone UK does not plan to maintain a large FWA subscriber base once FTTP rollouts are complete and has therefore not invested in automating retail processes for FWA.
Operators need to be aware of best-practice approaches to FWA from around the world to determine which FWA strategies are best for their local market contexts. This way, operators can benefit from the opportunities presented by FWA in the specific contexts where it will be disruptive,” said Bruff.