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Verizon Is Facing Traffic Pressures in Major Markets, They are Pouring Money into it and Should be Resolved by End of 2013

November 12, 2013 - Written By Alexander Maxham

It appears that Verizon is beginning to feel the power of all these LTE-enabled devices on their network. I hate to compare it to T-Mobile or AT&T’s network since they are literally two different networks (Verizon is CDMA/GSM combination and AT&T/T-Mobile are full on GSM networks). But both AT&T and T-Mobile have the bandwidth to support their customers, then again, they don’t have as large a LTE network or as many customers as Verizon either. So it’s really not a fair comparison.

On Tuesday, Verizon’s CFO Fran Shammo admitted that the rapid growth of traffic on their network is starting to hamper the quality of their service. This is pretty surprising to see big red admit to this. But I have a feeling that the only reason why they admitted it was to say that they are working on the issue and will be fixed by the end of this year. “There are certain pockets where we’re absolutely going to experience that down tick from LTE network down to 3G because of capacity constraints.” Said Shammo.

For the longest time, Verizon has been boasting about having the largest LTE network and having the first LTE network as well. Which means they have more LTE customers, not to mention that in most places they have the best coverage which also means more customers than their competitors. The growth in data traffic is really beginning to hurt them. Verizon has stated in the past that LTE customers make up nearly a third of their customer base and they consume 64% of traffic.

Although, “By the end of this year you are going to see all those issues dissipate” said Shammo today. “And then going into next year we will be ahead of the curve again.” As a carrier that makes a boatload of profit every quarter, they are able to pour money into issues like this very quickly, which is where they are ahead of their competitors, especially T-Mobile and Sprint.