Can Verizon Multiply Its 4G Coverage and Earnings?

Verizon (NYSE:VZ) seemed to get the better end of a deal with AT&T (NYSE:T) last week, and could be expanding its 4G LTE availability with more frequencies. But, a new device from Verizon could help the carriers expand the number of devices supported by its 4G LTE tenfold.

The deal between Verizon and AT&T would see AT&T receive 39 spectrum licenses for Verizon’s 700MHz spectrum. This would give AT&T the ability to offer coverage to about 42 million people in 18 states. However, in exchange, Verizon would receive $1.4 billion in compensation — part cash, part Advanced Wireless Services spectrum.

Markets are at 5-year highs! Discover the best stocks to own. Click here for our fresh Feature Stock Pick now!

The AWS spectrum is the same that T-Mobile users for its 3G and 4G LTE networks. So it’s possible Verizon could be planning to use the AWS spectrum to expand its own 4G network, which is already far ahead of AT&T’s in terms of coverage. The FCC could yet delay or block this deal between the two carriers, but that might not slow down Verizon’s 4G expansion.

A new pocket-sized device from Verizon will allow the carrier to branch out the way it provides 4G coverage, and perhaps more importantly, how much data it can offer…

The new device is a mobile WiFi hotspot, called the Jetpack 4G LTE Mobile Hotspot MiFi 510L. While the name might be a bit clunky, the device should prove thoroughly small and portable. Of course, the 510L won’t actually be adding 4G coverage to new areas, but it will be expanding the many ways customers can connect to the data network and how many different devices they can connect.

Each 510L can support up to 10 separate devices connecting to it through WiFi, and then it would provide Ianternet to those devices via its own 4G connection, so more devices can get onto Verizon’s 4G LTE network. And, customers can use more data.

When a smartphone uses the Internet, it usually runs into websites in special mobile formats that require less data — this makes the pages load quicker and cost less on users’ data plans, and this is just one of the ways mobile devices minimize data consumption. Running a computer over a data plan would almost surely use a lot more data, meaning Verizon would likely be seeing more revenue from increased data plans — or from data overages, depending on the customers.

The device is planned to launch January 31, and will only cost $19,99. So, it may draw customers in with its low initial price, and then boost Verizon revenue with increased data plan payments.

Don’t Miss: Apple Releases First Major Update to iOS 6.