Rutledge

Charter Communications is using the benefits of the Republican-promoted tax cut to buy back its own stock, because the only other option under consideration was using the money to buy up other cable operators.

“From a [mergers and acquisitions] perspective, I think cable is a great business. If there were assets for sale that we could do more of, we would do that,” said Charter Communications CEO Thomas Rutledge at this week’s UBS Global Media & Communications Conference. “We’ve been buying a lot of our own stock back. Why? Because we think the cable business is a great business and we haven’t been able to buy other cable assets.”

Charter is not using the company’s lower tax rate to benefit Spectrum customers with lower bills or more extravagant upgrades. Instead, it is accelerating efforts to please shareholders and executives with efforts to boost its share price — something key to top executives’ performance bonuses.

With digital and broadband upgrades nearly complete in areas formerly served by Time Warner Cable and Bright House Networks — the cable companies Charter acquired in 2016 — Rutledge told investors he can initiate additional upgrades without spending huge sums on infrastructure buildouts.

Gigabit speed is now available in most markets, and the company has doubled its lowest internet download speeds in areas where it faces significant competition from AT&T from 100 to 200 Mbps, boosting sales of Spectrum broadband service, according to Rutledge.

Today, about 60% of Spectrum customers are offered 100 Mbps, while the other 40% — mostly in AT&T service areas — are getting 200 Mbps.

Rutledge told investors he does not see much threat from Verizon FiOS or its newly launched 5G offerings, and has no immediate plans to upgrade service in Verizon service areas because neither offering seems that compelling.

“I saw that Verizon had some passings that they could do 800 Mbps in,” Rutledge said. “We have 51 million passings that we can do 1 gigabit in and we can go to 10 gigabits relatively inexpensively and I think we will because I think the world will go to 10 gigabits.”

Analysts are uncertain whether Rutledge’s comments are naïve or brave.

“We see 5G fixed wireless broadband [like that offered by Verizon] as the largest existential threat to broadband providers, by far,” wrote analysts at Cowen. Until now, most broadband competition for cable operators came from phone companies pitching DSL. Verizon retrenched on its FiOS offering several years ago. But AT&T has been more aggressive upgrading urban areas to fiber service, which has forced Charter to respond with higher speeds and better promotions.

Rutledge does not see Verizon’s 5G being a significant competitive threat for several years, and suspects Wall Street may once again punish Verizon for spending money on a wireless network less capable than what the cable industry offers today. Shareholders may also dislike watching Verizon distracted by the home broadband market when portable wireless revenues are much more important to the company.

Verizon officials claim about half of those signing up for its 5G service plan were not current Verizon customers. But the company would not say whether their new fixed wireless customers were coming largely from cable or DSL disconnects, which would prove marketplace disruption.

Forty companies, including hedge funds, phone companies, and wireless carriers have collectively bid $336,265,480 so far for about 2,500 28 GHz licenses (out of 3,072 available) that will be a part of the buildout of 5G millimeter wave wireless service.

The FCC is currently auctioning off spectrum in the 27.5–28.35 GHz (28 GHz) band — a very large chunk of frequencies which can offer bidders the opportunity to launch a wide bandwidth cellular data service capable of very fast internet speed. But because the frequencies involved are line-of-sight, the winning bidders will have to invest in large networks of small cell antennas that will be required to reach customers.

Citigroup analysts reviewing the auction results so far told clients they suspect there are “two outsized bidders” winning many of the available licenses, including Verizon. This is not a surprise, considering Verizon already has significant spectrum holdings in the 28 GHz band. Verizon’s current 5G service relies on this millimeter wave spectrum, but is available so far only in a handful of markets. The identity of the second major bidder remains a mystery. The spectrum licenses getting no bids are mostly in rural areas with low population density.

All the other major wireless operators — AT&T, T-Mobile, and U.S. Cellular — are also bidders. Only Sprint, currently in a merger deal with T-Mobile, is missing. AT&T has not shown much interest in offering its customers millimeter wave 5G service, and T-Mobile is planning to use 5G’s technology upgrade to bolster its existing network with more capacity and speed. Dish Network, which already controls a substantial portfolio of unused spectrum, is also a bidder and could be seeking to stockpile 5G spectrum for a future venture or sales deal with one of the other wireless companies.

The qualified bidders:

Bidding starts at $200 per available county, and many rural licenses could be won for precisely that amount, with only one interested bidder offering the minimum bid.

The highest bids are just over $10,000,000 each for two licenses in the Honolulu, Hawaii market. Bids in excess of $2 million are currently on the table in these counties:

California: Kern
Colorado: El Paso
Florida: Volusia
Illinois: Winnebago
Iowa: Linn
Louisiana: East Baton Rouge
Maine: Cumberland
Missouri: Greene
Nebraska: Lancaster
Nevada: Washoe
Oregon: Jackson
Pennsylvania: Lancaster, Berks, York, Lehigh, Luzerne, Northampton, Dauphin
Texas: Cameron, Hidalgo
Wisconsin: Dane

Property owners in New Zealand may have to trim back or remove trees if they are proven to interfere with Wi-Fi or wireless broadband services in the neighborhood, according to an interesting High Court judgment that could establish a wide-ranging precedent.

As short-range 5G wireless internet services become established, high frequency and millimeter wave-based signals depend on line-of-sight communications with end users. Trees and buildings can reduce signal range or block the signal entirely, rendering the service unusable. In this case, an appeals judge was asked to rule whether broadband users or property owners took precedence when a large stand of trees or a building in an adjacent yard made wireless reception more difficult or impossible.

Justice Sally Fitzgerald found that when alternative solutions like relocating a receiver cannot be found to mitigate reception problems, nearby property owners may have to take steps to protect neighbors’ access to Wi-Fi and other wireless services, under a new interpretation of Section 335(1)(vi) of the [Property Law] Act of New Zealand. Similar laws are in place in North America and European countries.

The decision could result in a dramatic increase in legal challenges from frustrated neighbors who cannot get good reception because adjacent property owners prefer a tree-filled landscape.

Justice Fitzgerald

Fitzgerald based her decision on basic property laws that make illegal anything that can unduly interfere with the reasonable use and enjoyment of private property. Such laws are used as a basis for noise ordinances, zoning restrictions, restrictions on commercial use of residential property, and placement of structures on or near property lines. This judge found no special distinction between physical objects or noise and wireless transmissions. But she did find reasonable limitations on what would constitute a valid complaint.

In this case, Ian and Karen Vickery brought the complaint against their neighbor Christine Thoroughgood, for interfering with their access to wireless internet by refusing to trim the trees on her property line. But the judge found a better answer than ordering a robust tree trimming. Fitzgerald found the Vickery’s already receive a suitable signal after placing a receiver on a pole located away from their home. Therefore, the judge ruled against the complaint by the Kiapara Flats couple, even though they preferred placing the receiver on their home.

Legal observers found the case precedent-setting, despite its low-key outcome, because this High Court judge has established a right of access to broadband that takes precedence over property owners’ landscaping and buildings. Under certain circumstances, a neighbor may be forced to trim, remove, or alter trees and structures on their land if a neighbor can prove it directly interferes with their right to access wireless signals like broadband in a way that cannot be mitigated.

From the decision:

I am satisfied, and Mr. Allan properly accepted, that undue interference with a Wi-Fi signal caused by trees could constitute an undue interference with the reasonable use and enjoyment of an applicant’s land for the purposes of s 335(1)(vi) of the Act.

From reviewing the evidence, however, I do not agree that the Judge erred in accepting independent expert evidence (in fact called by Mr. Vickery) which objectively contradicted Mr. Vickery’s personal evidence on the issue as to Wi-Fi signal.

The expert, Mr. Lancaster, explained that Mr. Vickery’s Wi-Fi service is a “fixed wireless solution”. He notes in his technical report that it works by having the internet service provider establishing a “broadcast site” in a prominent location and connecting to customers with clear “line of sight” to that broadcast site.

In this case, the broadcast site (provided by Compass Wireless) is located on Moirs Hill Road. Mr. Lancaster notes that “nominally the solution will service customers up to 30 kilometres away from the broadcast site subject to a clear unobstructed line of sight.” In this way, Mr. Lancaster confirms that trees could obstruct the otherwise clear line of sight.

At present, the Wi-Fi transponder (or receiver) at the Vickerys’ home is mounted on a pole a little distance away from the rear of the house. I viewed its location during my site visit and have reviewed the photographs in Mr. Lancaster’s report. With the transponder located in its present position (referred to by Mr. Lancaster as “Location A”), Mr. Lancaster states:

There is currently a clear signal to the installed dish and other parts of the property, the signal has remained good for the past two years since installation.

This current location, however, is not Mr. Vickery’s preferred location. He notes that the present location is in a particularly windy site and on one occasion the wind was so strong it blew the cable out of the back of the aerial. Mr. Vickery also noted that another much larger stand of pine trees on the Thoroughgoods’ land, some considerable distance away, are also impacting what is referred to as the “Fresnel zone” of the Wi-Fi connection in its present location.

Mr. Vickery’s preferred location is closer to and attached to the back of the house itself, where it would be easier for Mr. Vickery to service the transponder. At this location however, Mr. Vickery says the trees in issue will interfere with the signal.

Mr. Lancaster states in his report that he spent over two hours on site and only identified two other locations (other than the present location, Location A) which he would consider appropriate for an installation.

The first of these alternative locations (Location B) is on the northeast corner wall of the home — Mr. Vickery’s preferred location. Mr. Lancaster states “this is the location the Compass installers would have chosen by default and as a standard installation”. In relation to Location B, Mr. Lancaster states “it is obviously at risk due to close proximity to the existing tree/shrub planted boundary, being approximately three metres above ground level.” He states that to retain adequate signal at this location, a window would be required in the shelter belt hedge — the trees in issue in this case.

In light of the independent expert evidence, I do not accept the Judge erred in concluding there was no undue interference with the Vickerys’ Wi-Fi signal. It is important to reiterate that not only does the expert evidence not indicate an interference, but the standard required by the legislation is an “undue” interference in any event. The expert evidence confirms this threshold has not been met.

Accordingly, while it is true that Mr. Vickery’s preferred location for the Wi-Fi transponder would be on the wall of the home, there is clearly an alternative location which is currently being used and which is considered by Mr. Lancaster to be adequate. There is also a further alternative and adequate location (Location C). And although this location would require cabling, this would not in my view be unreasonable in the circumstances.

I accordingly do not consider the ground of appeal concerning Wi-Fi has been made out.

A Verizon 5G small cell installed in Sacramento. (Image courtesy: ZoraQ)

Consumers hoping for the imminent arrival of a “cable killer” from Verizon’s new millimeter wave 5G fixed wireless broadband should not hold their breath.

Verizon executives have been paraded out to celebrate its debuting 5G service as “revolutionary/game changing/transformational” at the same time Qualcomm, which helped define the forthcoming 5G standard claims it will be “as transformative as the automobile and electricity.”

But the ‘Revolution of 5G’ will not be the next fall of the Berlin Wall or Arab Spring. Those revolutionary changes happened almost overnight. Instead, 5G will be quintessential American capitalism at work: overhyped promises to excite the public and attract investors, tempered by the reality that massive amounts of money and at least a decade of work will be needed to blanket only parts of the country with small cells and the newly ubiquitous fiber optic networks required to connect them together.

Verizon already offers hints of that reality, but only in the fine print where it acknowledges its wireless home broadband replacement service, set to launch on October 1, will be only available in parts of four U.S. cities. Verizon isn’t saying what percentage of Sacramento, Los Angeles, Houston, and Indianapolis will be covered, but enthusiastic would-be customers are crowdsourcing their own coverage maps, and the results are underwhelming.

The City of Sacramento released this map showing Verizon’s planned 5G coverage in the city, but customers dispute it. (Image: City of Sacramento)

“Lightning has hit more homes than Verizon 5G will in Sacramento,” reports Jack Del Vecchio, who spent an hour entering addresses on Verizon’s website looking for service. “The city of Sacramento, trying to placate homeowners worried about more cell equipment visually polluting the city, released a map where Verizon claimed it would be offering 5G service by the end of 2018. That clearly is not happening, at least not yet, because most of these neighborhoods do not have small cells installed yet.”

In Indianapolis, reddit user rycummin_IU scanned almost 17,000 addresses and found Verizon service available to just 179 homes and businesses. Only a fraction of customers in Houston and Los Angeles are qualified for service as well.

The vast unavailability of Verizon 5G service in Indianapolis. (Image courtesy: rycummin_IU)

“When they said Houston would be part of the rollout I didn’t think they meant one street,” commented another reddit user. In reality, Verizon 5G will debut in parts of low-income neighborhoods like Acres Home, Gulfton, Second Ward, Third Ward and Near Northside, at the behest of city officials, among a few others. But availability is very scattered, and based on search results, Verizon is only qualifying customers that live within approximately 500 feet of a small cell antenna.

This map shows the limited range of Verizon 5G small cells. In this case, this neighborhood is likely served by one or two small cells, probably in the vicinity of Sugar and Brady and/or Eastwood or Jenkins St. Notice coverage is often unavailable across streets. (Image courtesy: SmokeyTuna)

The most unlikely choice for limited range 5G is notoriously sprawling Los Angeles, and frustrated residents reported service was least likely to be found there.

“I spent 30 minutes plugging in random addresses all over Los Angeles and I finally found one that works,” reports reddit user chantasic. “It’s the big apartment building at 1108 7th Street, Los Angeles, CA, 90017 in [downtown Los Angeles]. If you go just one block west from there on Garland Ave, it’s not available. If you enter in ‘1127 Lucas Ave Los Angeles, CA 90017’ which is a high-rise, then it starts asking you what floor you live on and whether you have any windows that face 7th St. So one of the antennas must be on 7th St.”

“I put in my work address and it worked at 555 South Flower street, which is across from the library on West Fifth Street,” shared another user. A third reddit reader in Los Angeles managed to track down service at Medici Apartments, a complex next to the 110 freeway in the South Westlake area.

Those customers who are lucky enough to live in a qualified service area report the sign-up process to be orderly. A full credit check is done on prospective customers, and assuming one passes it, an appointment for “white glove” installation is scheduled. Verizon has confirmed no self-install option will be available for the time being. Verizon’s installers are trained to find the best possible place to install its 28GHz antenna, which does not perform well penetrating heavy foliage, certain building materials, and low-energy insulated window glass. Verizon plans to monitor the performance of these early 5G installations to gather more information about how the service is working and how to get the best performance from it.

Verizon has released terms and conditions for the service and provided more insight into the installation process, which takes several hours. Customers interested in more information can call this special Verizon 5G hotline — 1-866-217-2223 to order and schedule installation, or find out about 5G Home.

Verizon 5G Home Terms of Service

Two pieces of 5G Home equipment will be installed at your home:

• Indoor or outdoor 5G receiver
• 5G router

The type of receiver (indoor or outdoor) you get depends on the 5G signal strength. If needed, Wi-Fi extenders will be installed in the home, at no charge, to ensure adequate Wi-Fi coverage for the entire house.

What will happen during the 5G Home installation?

An Asurion (third party contractor) technician will complete the following installation process for your 5G Home service and connect your devices:

• Verify and explain the areas in your home where the 5G signal is received.
• Conduct a test to determine whether the 5G receiver can be installed inside or outside your home. The strength of the 5G signal can vary inside and outside your home.
• Conduct a test of the Wi-Fi signal strength of each device throughout the house that is connected to the 5G Home router. A Wi-Fi extender may also be installed at no charge to strengthen the Wi-Fi signal throughout your house or for devices that have a weak Wi-Fi signal.
• Install the receiver, with your approval, either inside or outside on the side of your house.
• Depending on the locations of the receiver and the router, the technician may need to run wires through walls, floors or ceilings.
• Ensure that all your previously Wi-Fi connected devices are now connected to your Verizon 5G Home router.
• Demonstrate how you can use the My Verizon app to manage your router, such as how to restart it when you are away from home, and check the signal strength of the devices connected to the router.

Service Availability. Unfortunately, we can’t guarantee that our 5G Home service will be available at your address, even if we accepted your order. The 5G Home service does not support static IP addresses.

Equipment. We’ll provide you with equipment, which may include an indoor or outdoor receiver, a router, a Wi-Fi extender, and other equipment, to use with your 5G Home service. That equipment will continue to be owned by us, and you can’t use it for any other purpose, move it to a different location or position, tamper with or intentionally damage it, or allow anyone else to service it. We will repair and maintain that equipment at our expense, unless we determine that you misused, abused or intentionally damaged the equipment, in which case, you will have to pay the replacement cost of it. If any of that equipment is stolen, please provide us with a copy of your police report, so that you are not charged for it.

Installation and Access to Your Premises. We will attempt to install the 5G Home service at the address that you provided to us at the time of sale. From time to time, we may access your outdoor receiver to service, inspect, upgrade and/or remove it. If 5G (or 4G LTE backup) coverage is not available at your address, or if we cannot perform installation for any reason, then we will cancel your order.

Changing Service Location. You may not move the 5G Home service to another address. If you are moving to a new address at which the 5G Home service is available and you wish to continue using it, then please contact us to install it at your new address.

Service Cancellation and Equipment Returns. Upon termination of your 5G Home service, you should return the equipment to us in an undamaged condition (subject only to reasonable wear and tear) within 21 days after service cancellation, or you may be charged an unreturned equipment fee, which may be substantial. If you don’t cancel your 5G Home service, then your service charges will continue to apply, even if you return the equipment. If we ask you to leave the outdoor receiver in place, you will not be charged an unreturned equipment fee.

Verizon 5G Home will begin accepting new customer orders for its in-home wireless broadband replacement as of this Thursday, Sept. 13, with a scheduled service launch date of Oct. 1.

The new high-speed wireless service will be available in select parts of Houston, Indianapolis, Los Angeles, and Sacramento.

Verizon CEO Hans Vestberg is calling the service part of Verizon’s 5G Ultra Wideband network. Initial reports indicate speed will range between 300-1,000 Mbps and existing Verizon Wireless customers will get a $20 price break on service — $50 a month instead of $70 for non-Verizon Wireless customers. We are still waiting word on any data caps or speed throttle information. Verizon informs Stop the Cap! there are no data caps or speed throttles. Service is effectively unlimited, unless hidden terms and conditions introduce unpublished limits.

Interested customers can determine their eligibility starting at 8 a.m. ET on Thursday from the Firston5G website. If you are not eligible initially, you can add your email address to be notified when service is available in your area.

Early adopters will be awarded with a series of goodies:

• Free installation (a big deal, since it could cost as much as $200 later. An external antenna is required, as well as in-home wiring and equipment.)
• 90 days of free service (a good idea, considering there may be bugs to work out)
• 90 days of free YouTube TV (a welcome gift for cord-cutters)
• Free Chromecast or Apple TV 4K (a common sign up enticement with streaming cable-TV replacements)
• Priority access to buy forthcoming line of 5G-capable mobile devices

Customers in the first four launch cities will be using equipment built around a draft standard of 5G, as the final release version is still forthcoming. Verizon is holding off on additional expansion of 5G services until the final 5G standard is released, and promises early adopters will receive upgraded technology when that happens.

Verizon is clearly providing a greater-than-average number of enticements for early adopters, undoubtedly to placate them if and when service anomalies and disruptions occur. Although Verizon has done limited beta testing of its 5G service, it is very likely the 5G network will get its first real shakeout with paying customers. Unanticipated challenges are likely to range from coverage and speed issues, unexpected interference, network traffic loading, the robustness of Verizon’s small cell network, and how well outside reception equipment will perform in different weather conditions, particularly heavy rain and snow. With a large number of freebies, and no charges for 90 days, customers are likely to be more forgiving of problems, at least initially.

Chromecast

Verizon’s 5G network depends on millimeter wave spectrum, which means it will be capable of providing very high-speed service with greater network capacity than traditional 4G LTE wireless networks. But Verizon will have to bring 5G antennas much closer to subscribers’ homes, because millimeter wave frequencies do not travel very far.

Verizon will combine a fiber backhaul network with small cell antennas placed on top of utility and light poles to reach customers. That explains why Verizon’s initial 5G deployment is unlikely to cover every customer inside city limits. There are substantial deployment costs and installation issues relating to small cells and the optical fiber network required to connect each small cell.

Verizon’s existing FiOS network areas will offer an easier path to introduce service, but where Verizon does not offer its fiber to the home service, it will need to bring fiber optic cables deep into neighborhoods.

AT&T sees a similar challenge to 5G and is openly questioning how useful wireless 5G can be for urban/suburban broadband service, considering it can simply extend fiber optic service to those homes and businesses instead, without a costly 5G small cell deployment.

Verizon introduces 5G wireless in-home broadband in four U.S. cities and starts taking new customer orders on Thursday. (1:00)

Article updated at 6:28pm ET with information about data caps and speed throttles provided by Verizon.