Better User Experience to Determine Broadband Operator Success

The demand for high-speed broadband access has always been on the rise across different markets. The COVID-19 pandemic accelerated the demand and triggered broadband industry players to act quicker to improve the existing broadband services, as well as to connect the unconnected areas. Recently, the Canadian government announced US$0.83 billion (CAD 1 billion) funding to be allocated for Canada’s Universal Broadband Fund. Similarly, the government of United States promised to devote US$100 billion to broadband for an eight-year infrastructure plan to deploy high-speed broadband connections in underserved areas. These are additional plans to accelerate ongoing universal broadband initiatives in the two countries.

The fixed broadband market, which consists of a combination of digital subscriber line (DSL), cable, and fiber broadband services, has already reached over 80% of household penetration at present in North America. Many of the households without fixed broadband connectivity can access internet via other technologies such as mobile and satellite platforms. Fixed wireless access (FWA) broadband services over LTE network as well as proprietary technologies, which are non-3GPP standard based FWA platforms, have been supplying the broadband service to homes in suburban and rural areas. 5G FWA services have entered the market as operators such as Verizon and T-Mobile launched residential broadband service using their 5G networks. Satellite broadband services via MEO services have been supplying a small proportion of broadband in rural areas. SpaceX’s launch of LEO based satellite broadband service in 2020, Starlink, is a new addition to fulfill broadband need in the North America.

Despite the availability of different broadband platforms, ABI Research’s market data indicates that around 18 million households in North America are not connected to any type of broadband services. If recently revealed government broadband plans are implemented properly, these unconnected households will surely benefit. In order to effectively support consumers’ broadband demand, government initiatives need to consider how to allocate the funds; subsidizing the private or public players, as well as the choice of broadband technology for deployments, for example, whether to expand fiber-to-the-homes to improve broadband quality or to expand the accessibility using FWA services or satellite.

Cable networks, which serve more than 63% of total fixed broadband market, have already migrated to DOCSIS 3.1 technology to support Gigabit speed broadband access. However, fiber-to-the-home (FTTH) penetration in the region is relatively low, only representing about 15% of total market since many areas still rely on DSL broadband technology. Although the details of government initiatives are yet to be specified, there are unserved areas which need network expansion and network upgrades from DSL to higher speed very high-speed digital subscriber line (VDSL) or FTTH networks. Replacing DSL lines with fiber optic to provide FTTH would support future proof connectivity; however, it would not be economically viable as illustrated by the shortcomings of Australia’s NBN strategy. Especially in suburban or rural areas with low population density, the cost to connect FTTH each home can be too high. In this case, FWA services are great option to provide better quality broadband instead of capital expenditures (CapEx) heavy FTTH roll outs. Therefore, government’s broadband funding should not be limited to a single network infrastructure but support flexible choice of technologies.

When using mmWave, 5G FWA can support multi-Gigabit speed, a fiber-like broadband access. While mmWave deployments may not be suitable for sparsely populated areas due to cell densification requirement, 5G FWA in mid-band spectrum can be deployed for less dense areas. In addition, FWA deployments using licensed or lightly licensed bands and non-3GPP technology can also be cost effective solutions for rural areas. Terragraph is one example which is deploying FWA access using unlicensed 60 GHz band. In addition to standalone FWA services, integrating FWA service onto existing fixed broadband services as a backup connectivity can also improve broadband quality. Hybrid FWA and fixed broadband services can ensure connectivity in case of disruption on fixed network. Such a feature is advantageous since broadband users are increasingly accessing critical communication applications related to work, study, and healthcare, which need consistent network quality during the pandemic.

In addition to consideration of connecting underserved and unserved areas, there are areas service providers can improve for existing broadband users. Even though we are looking forward to return to the pre-pandemic work and schooling practices in later 2021, the demand for better home broadband services is expected to continue. Since the efficiency of remote working, learning and telehealth use cases have been witnessed when there is reliable broadband access, the use of these applications via home broadband networks are expected to accelerate in the years to come.

Service providers can take advantage of this potential shift to create opportunities to improve customer loyalty and generate more revenue. Beside integration of FWA solutions to home broadband services, smart Wi-Fi solutions, such as mesh systems to support whole home Wi-Fi and integration of Wi-Fi 6 to boost overall improvement in-home Wi-Fi networks, can assure quality of experience. Investment in Artificial Intelligence (AI) assisted analytics solutions can help service providers identify broadband packages and customer-premises equipment (CPE) which are suitable for different customers. In mature markets, the adoption of smart home applications such as home security, energy management, and elderly care, is increasing. Integration of Wi-Fi sensing technology onto home networking devices can benefit both service providers and end users to support smart home services without the need of additional sensors and devices. The ability to support these solutions in addition to integrating FWA can create more revenue streams for service providers.

ABI Research forecasts that total broadband market in North America, including fixed broadband, FWA, and satellites, will surpass 100% of total household penetration by 2025. As the market is saturating, the competition among broadband services will become tougher. Broadband service providers need to ensure provision of products and services which support better user experience to maintain business success.