For much of July, the FCC seemed to be yet again the center of attention across the telecommunications industry. Early in the month, the Commission released initial post-600MHZ auction reassignments on a website dedicated to the repack process. It had also begun paying broadcasters for giving up spectrum. Additionally, broadcasters that have to repack have asked the FCC for reimbursements for an estimated $2.1B in initial repack costs. The FCC, though, primarily found itself in the spotlight because of the raging net neutrality debate. Many are urging the Commission to reverse the reclassification of broadband Internet as a public utility. On the other hand, small cable companies and new entrants continue to vocalize their support for the removal of net neutrality, arguing the rules restrict their success. Mid-month, there was a “Day of Action to Save Net Neutrality” where thousands of constituents pleaded to Congress to support Net Neutrality, meanwhile, the major networks including Comcast, Verizon, and CenturyLink reemphasized their stance against it, professing a less regulated internet is better for consumers. The FCC is garnering further attention, by the 6-month old administration’s general stance of taking a “weed whacker” to regulation beyond net neutrality.
Out of the many technological frontiers the industry is foraging, IoT seemed to be most discussed this month. Even though the promise of connecting virtually everything to the internet would add tremendous value to everyday life, pundits are debating whether the benefits outweigh the risks. Critics believe it’s highly unlikely that IoT devices will be regularly updated once they are deployed, leaving them vulnerable to increasingly pervasive ransomware attacks. Regardless of how the paybacks and drawbacks of IoT turn out, it’s undeniable that telcos will come out as winners, providing connectivity to an explosion of connected devices. AT&T is clearly bullish on the phenomenon, investing $200 on SDN and IoT-focused startups. It’s estimated that today, only 1% of things that can be connected and as many as 50 billion devices will be connected by 2020. As it stands, the ecosystem of 2,888 companies that are building an IoT reality are estimated to employ 342,000 workers, have raised $125B in funding and have generated $513B in value. Smart cities specifically are expected to become a $1.2 trillion market by 2022 from $424B in 2017, growing at a healthy compounded annual growth rate over 23%.
There was one major M&A deal in the industry in July. After much speculation, Crown Castle purchased Lightower, confirming the value wireless infrastructure providers find in physical fiber assets to support 5G delivery. Inter-industry acquisition seems to be all the rage. In addition to the melding of wireless and wireline companies, there’s speculation that we’ll see the large telcos pickup additional media and content assets, a la AT&T nabbing Time Warner. Verizon possibly purchasing Walt Disney is the latest juicy rumor the industry is chewing on. This is just nascent speculation and many potential problems in the hypothetical merger have already been identified.
That’s all for now. Check out our latest in musing in Wireless Week on the AT&T / FirstNet deal and don’t forget to stay tuned for up-to-date news and views from the Vertix team. Until next month…