Another six months of wireless signal reports, another win for Verizon Communications' (NYSE:VZ) network. The latest data from RootMetrics, which conducted more than six million wireless tests across the U.S., ranked Verizon as the nation's top performing network overall in the first half of 2015 -- marking the fourth consecutive time the carrier has won such a designation.
How the carriers stacked up
In the Overall Performance category -- which is a catch-all for which carrier has the most comprehensive network -- Verizon completely dominated.
Verizon took the top spot in five out of six categories, including network reliability, call and data performance, and network speed. The only category Verizon came up short in was text performance, with AT&T taking the win.
Meanwhile, Sprint earned the No. 3 spot for overall network quality, followed by T-Mobile. That has got to sting a little bit for the so-called Un-carrier, considering T-Mobile has worked so hard building out its LTE network over the past few years. T-Mobile recently overtook Sprint as the nation's third largest carrier by subscribers and has also been named the nation's fastest wireless carrier, according to Ookla.
And if there were any doubts as to how well each carrier stacked up against Verizon, consider that the carrier outpaced all of its competitors when it came to state-level tests. Verizon won or tied for 253 state-level awards for reliability, speed, data, call and text performance, while AT&T took 95, Sprint claimed 25, and T-Mobile earned, well, none.
Where the industry is headed
While all of the carriers are constantly jockeying for the best position, the wireless carrier industry appears especially in flux right now. T-Mobile has about 59 million wireless customers, surpassing Sprint's 57 million, and has set its sights on taking down AT&T. But that's easier said than done considering T-Mobile falls well short of AT&T's 124 million wireless subscribers. Still, T-Mobile's low prices and swift subscriber acquisitions recently forced AT&T to change the prices of its smartphone plans.
Meanwhile, Sprint is still fighting back from previous subscriber losses, despite holding a lead over T-Mobile's network quality. T-Mobile has focused much of its attention on improving its metro areas, and has ignored some suburban and rural areas as a consequence. But as T-Mobile makes large customer gains, it's hard to imagine the carrier won't start focusing its attention on expanding its quality and coverage to match its users' needs.
Sprint and T-Mobile will likely duke it out for the foreseeable future, while AT&T makes moves into Verizon's territory. In the report, RootMetrics said: " ... it appears that AT&T isn't content to rest on its laurels and stay in this position," noting that the carrier earned 53 more awards in the first half of 2015 than it did in the second half of 2014.
Unseating the king won't be easy
While all of the carriers are making good strides, their position in the wireless space is likely to remain the same -- mainly because Verizon and AT&T are spending piles of cash in order to stay on top. Here's a quick breakdown of how much each carrier is spending this year (or for Sprint, over the next few years):
|Verizon||$17.5 billion to $18 billion|
|Sprint||$15 billion (over the next three years)|
|T-Mobile||$4.4 billion to $4.7 billion|
All of this spending pretty much ensures that Verizon will stay ahead of the pack, even if just slightly beating AT&T, while T-Mobile and Sprint will continue to lag behind. Verizon built out its network much faster and better than the other carriers, and it's being wise about spending money on new upgrades like small cell technology and using existing the wireless spectrum in more efficient ways (called carrier aggregation). Meanwhile, the rest of the carriers will have to settle for a distant second, or worse.
Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Verizon Communications. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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