CoBank, a key lender to the rural telecom industry, has issued a white paper expressing skepticism about 5G fixed wireless forecasts, such as one from ABI Research, which calls for 26% annual revenue growth worldwide. CoBank also challenges the Verizon 5G fixed wireless forecast which, it says, calls for a 20% to 30% take rate.

“To us, these market penetration and revenue forecasts seem optimistic,” CoBank writes in the white paper.

As CoBank explains in the white paper, 5G fixed wireless technology is expected to provide speeds in the range of 300 Mbps to 1 Gbps. Typically, an access point is mounted on a fiber-connected pole within 1,000 to 2,000 feet of customers, the author explains.

It’s important to note that the deployment scenario that the white paper describes would typically be associated with high-frequency spectrum such as the millimeter wave spectrum that Verizon is using for its initial fixed 5G rollouts. The higher-band spectrum can support the highest-speed fixed 5G services but over relatively short distances.

Verizon is targeting parts of metro markets where the company doesn’t offer fiber to the home for its fixed 5G rollouts, which commenced in October. And as a lender to rural network operators, it’s not surprising that CoBank sees the potential of 5G fixed wireless differently than Verizon does.

“Building these networks comes with significant execution risk and leverage demands that could be problematic given the current EBITDA levels for many [wireless ISPs],” the white paper says.