The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.NEW YORK ( Trefis) -- Although Verizon ( VZ) was in the forefront when it launched its 4G LTE network more than a year ago, customer adoption of the new high-speed technology has been slow. Speaking at an investor conference Monday, Verizon Wireless' CFO Fran Shammo said that only about 5% of its total customer base use an LTE smartphone. Verizon is currently well ahead of AT&T ( T) and Sprint ( S) in terms of LTE deployment with coverage in 196 markets across the U.S. It has also been actively promoting its LTE technology through the launch of cheaper smartphones and plans. We believe LTE adoption rates will pick up from here.
Verizon has been aggressively spending on its LTE infrastructure, rapidly rolling it out in new markets to maintain its lead over rivals AT&T and Sprint as well as making sure the outages do not recur. Its capital expenditures have been rising over the last few years, owing to the rapid deployment of LTE as well as 3G network upgrades, and we do not see it coming down anytime soon. Verzon is looking forward to increased adoption of its LTE network to recover at least a part of the huge capital expenses it has incurred. The launch of the iPhone 5 with LTE capabilities later this year will help further drive 3G adoption. Although the iPhone 5 may be available on competing LTE networks as well, Verizon's greater LTE coverage should help it attract more iPhone buyers. Higher LTE speeds will see subscribers increasingly using data-intensive applications on their smartphones. This will drive data revenues, thereby increasing ARPU levels for Verizon over the coming years. Click here to find out how a company's products impact its stock price at Trefis. Like our charts? Embed them in your own posts using the Trefis Wordpress Plugin.