Here's how Verizon plans to revive its ailing wholesale business - hint, fiber is key

  • Newly appointed SVP of Verizon Partner Solutions, Jeffrey Hulse, said the company’s investments in fiber and 5G could help grow its wholesale business

  • Price compression, fewer connections and over-the-top technologies have taken revenue out of the traditional wholesale market

  • Fiber infrastructure is essential to Verizon's wholesale services as customers look for more advanced wireless capabilities 

When it comes to Verizon’s wholesale business, growth is the name of the game.

That might seem like an uphill battle, considering the wholesale industry has been shrinking for years. But newly appointed SVP of Verizon Partner Solutions Jeffrey Hulse said the company’s investments in fiber and 5G could help it beat the odds.

Verizon's wholesale business provides telecommunications services (voice, data and internet connectivity, etc.) to other companies who then resell those services to end customers under their own brand. It allows other businesses, like ISPs or smaller telecom companies, to offer services using Verizon's network infrastructure without having to build their own. And it's a way for Verizon to leverage its network assets to generate additional revenue.

“We are all about getting to growth in the wholesale industry,” Hulse told Fierce Telecom in a recent interview. “But the industry, as a whole, is declining.”

Price compression, fewer connections and over-the-top technologies have taken revenue out of the space, he said. Overall, Verizon's wholesale revenues decreased during 2023 compared to 2022, which the company attributed in part to declines in traditional voice communication and network connectivity as a result of technology substitution.

A Global Data report confirmed as much. Last year Global Data forecasted that hyperscalers and cloud providers will continue to disrupt the traditional wholesale segment, "which is already facing inevitable change as new technologies differentiate players ahead of the game." 

New leadership

Verizon Business announced Hulse’s new SVP title in January, where he'll be responsible for domestic and international wholesale revenue growth and strategy. Hulse joined Verizon in 1997 and has served in various executive roles, most recently as VP and leader of the sales and solutions engineering teams. He succeeds Eric Cevis, who retired following 37 years at Verizon.

To combat a shrinking wholesale market, his number one strategy is “building back businesses at scale,” Hulse said. That includes expanding total serviceable market opportunity with the fiber Verizon has been putting in the ground for years.

Specifically, Verizon Business is working to light the fiber it started deploying to get ahead of the 5G curve in 2017, when it started heavily investing in its fiber footprint. That infrastructure has become essential in providing services to its wholesale clients as they aim to make more wireless capabilities readily available for other businesses to use. 

The company will now use its Intelligent Edge Network to make Wave, Ethernet, direct internet access (DIA), IDE and broadband available in its franchise markets. Hulse said the company has been lighting individual buildings for the past two years but will "increase [its] scale later in 2024.”

The mission is to grow a fully scaled business for 5G and 4G, then expand on market opportunities with an IoT, private 5G and MEC wireless portfolio. The wholesale business has “some" customers at that scale right now and more "midsize resellers are starting to move up.”

According to Hulse,Verizon also now owns about half of its cell towers in the U.S., giving them direct control over their network operations. Its network can access up to 200 megahertz of spectrum in “all the most important metro markets in the U.S.,” he noted, and is rolling out 5G services and offering up to 100 megabit download speeds, to cater to many modern business' need for direct internet access.

The business segment is focused on making available a wide range of services to wholesale markets, including Ethernet, internet broadband and dark fiber; set against the backdrop of opportunity to replace outdated copper-based services with new alternatives like Ethernet and wireless connectivity.

Ultimately, Verizon's wholesale strategy isn’t really about building anymore.

“Because we built an amazing core infrastructure out there, it's not really about adding to the core,” said Hulse.

"It's about looking at success-based capital investments we would make, and those are always on the table, because we put so much capital in the ground already," he concluded. "To do a new use case, a new building, really, it's not that much of an incremental investment.”