Verizon’s ambitious LTE plan will it succeed?

After the announcement of the HTC Thunderbolt, Verizon Wireless has announced it is going to offer its 4G technology, LTE in 147 US cities by the end of this year. That is an impressive roll out compared to the initial 39 markets they launched in December of last year. The speed they are offering is 5~12 Mbps on the download which is 3 to 5 times faster than the current 3.5G HSPA network. But in the field it’s probably going to be 2 to 3 times faster.


Verizon is attempting to cover one third of the market each year. So by the end of 2012 or early 2013 its 4G LTE network will probably be nationwide 100%. So the information leaked by Boy Genius Report last year was mostly true. This is quite ambitious because it took 4~5 years for 3G to roll out 100%. The budget required is also quite high. It is around $9 billion a year so it will accumulate to a cash-out of almost $30 billion in the span of 3 and 1/2 years. Then there are the huge marketing budgets involved, which are mostly subsidies, and this will cost them more than the network.

After the Smartphone Wars broke out in the US, subsidy per handset has gone up to almost $160 a device compared to the usual $90 prior 2008. The operators will probably run out of money by the end of this year so they will be in a situation where promoting LTE will push down their profits considerably. If Verizon is the only LTE operator in the US this will not be much a problem and Verizon will be able to control the amount of subsidy allocated between 3G smartphones vs. 4G LTE but if any of the other operators want to get a chunk of the LTE business it’s going to be war and almost a game of chicken. Profit levels of operators might almost fall to 70% of the current level and they will most likely end up agreeing for a cease fire at that time. So smartphone growth and LTE growth could come to a halt when that happens, probably during 2012.


Feb 25 2012

Counterpoint research is a young and fast growing research firm covering analysis of the tech industry. Coverage areas are connected devices, digital consumer goods, software & applications and other adjacent topics. We provide syndicated research reports as well as tailored. Our seminars and workshops for companies and institutions are popular and available on demand. Consulting and customized work on the above topics is provided for high precision projects.

Term of Use and Privacy Policy

Counterpoint Technology Market Research Limited


In order to access Counterpoint Technology Market Research Limited (Company or We hereafter) Web sites, you may be asked to complete a registration form. You are required to provide contact information which is used to enhance the user experience and determine whether you are a paid subscriber or not.
Personal Information When you register on we ask you for personal information. We use this information to provide you with the best advice and highest-quality service as well as with offers that we think are relevant to you. We may also contact you regarding a Web site problem or other customer service-related issues. We do not sell, share or rent personal information about you collected on Company Web sites.

How to unsubscribe and Termination

You may request to terminate your account or unsubscribe to any email subscriptions or mailing lists at any time. In accessing and using this Website, User agrees to comply with all applicable laws and agrees not to take any action that would compromise the security or viability of this Website. The Company may terminate User’s access to this Website at any time for any reason. The terms hereunder regarding Accuracy of Information and Third Party Rights shall survive termination.

Website Content and Copyright

This Website is the property of Counterpoint and is protected by international copyright law and conventions. We grant users the right to access and use the Website, so long as such use is for internal information purposes, and User does not alter, copy, disseminate, redistribute or republish any content or feature of this Website. User acknowledges that access to and use of this Website is subject to these TERMS OF USE and any expanded access or use must be approved in writing by the Company.
– Passwords are for user’s individual use
– Passwords may not be shared with others
– Users may not store documents in shared folders.
– Users may not redistribute documents to non-users unless otherwise stated in their contract terms.

Changes or Updates to the Website

The Company reserves the right to change, update or discontinue any aspect of this Website at any time without notice. Your continued use of the Website after any such change constitutes your agreement to these TERMS OF USE, as modified.
Accuracy of Information: While the information contained on this Website has been obtained from sources believed to be reliable, We disclaims all warranties as to the accuracy, completeness or adequacy of such information. User assumes sole responsibility for the use it makes of this Website to achieve his/her intended results.

Third Party Links: This Website may contain links to other third party websites, which are provided as additional resources for the convenience of Users. We do not endorse, sponsor or accept any responsibility for these third party websites, User agrees to direct any concerns relating to these third party websites to the relevant website administrator.

Cookies and Tracking

We may monitor how you use our Web sites. It is used solely for purposes of enabling us to provide you with a personalized Web site experience.
This data may also be used in the aggregate, to identify appropriate product offerings and subscription plans.
Cookies may be set in order to identify you and determine your access privileges. Cookies are simply identifiers. You have the ability to delete cookie files from your hard disk drive.