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AT&T Sets Its Sights on the Business Market with 5G

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Jan. 23 2019, Updated 4:12 p.m. ET

A growing addressable market

AT&T (T) is looking to sell 5G services to business customers as it leverages ultrafast wireless connectivity to broaden its revenue opportunities. According to AT&T, 5G connectivity can help businesses open up new revenue opportunities, reduce operational costs, and improve customers’ experience. As a result, AT&T believes selling 5G services to business users will be success.

AT&T began offering 5G services in a dozen cities in the United States in December, joining its rival Verizon (VZ), which launched 5G service aimed at residential customers in four cities in October. Verizon also revealed plans last year to sell 5G services to business customers.

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Taking broadband customers from cable companies

With 5G, wireless operators are threatening to take broadband customers from cable providers such as Comcast (CMCSA) and Charter Communications (CHTR). Verizon, for instance, marketed its 5G service, which supports speeds of up to 1 Gbps, as ideal for people looking to cut the cord or upgrade their cable service. Comcast exited the third quarter with over a million business broadband customers. In an effort to fight the 5G threat, cable companies are working on boosting their speeds, with Charter working on delivering speeds of up to 10 Gbps in the coming years.

AT&T’s revenue jumped more than 15%

AT&T generated $45.7 billion in revenue in the third quarter of 2018, representing an increase of 15.3% year-over-year. T-Mobile (TMUS), Sprint (S), and Verizon grew their revenues 7.5%, 6.4%, and 2.8%, respectively.

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