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What Is Verizon’s 5G Market Potential?

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Confidence in technology

Verizon (VZ) is initially targeting the consumer market with its 5G wireless broadband service, which it expects to debut on a commercial scale in 2H18. The company said the commercial rollout of its super-fast 5G Internet to residential customers was based on customer experience during trials in 11 markets in 2017.

Verizon added that the launch of commercial 5G broadband was based on the confidence it has in its 5G technology. Verizon worked with technology vendors Ericsson (ERIC), Cisco Systems (CSCO), and Samsung (SSNLF) on its 5G initiatives. For the planned commercial deployment of 5G wireless high-speed Internet in Sacramento, California, Verizon tapped Samsung as a supplier of crucial network gear.

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Connecting 30 million households to 5G broadband

While announcing plans for the commercial deployment of its 5G wireless broadband, Verizon estimated that its initial market opportunity in the residential broadband market could be 30 million households in the US (SPY). According to Ericsson’s mobility report, the number of 5G subscribers could reach 1.0 billion by the end of 2023.

Verizon is targeting to activate its 5G broadband service in up to five markets in the US this year, with Sacramento selected as the first city for the commercial launch.

Verizon closed 3Q17 with 148.9 million wireless subscribers, compared with 138.8 million for AT&T (T), 70.7 million for T-Mobile (TMUS), and 53.1 million for Sprint (S), according to Strategy Analytics.

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