Despite the sluggish economy, Verizon isn’t backing off of the gas pedal when it comes to building out its fiber optic FiOS network.
Verizon plans on having FiOS in more than its previously stated goal of 18 million homes by the end of 2010, according to Reuters. Verizon President and COO Denny Strigl said that the company would continue to expand its FiOS network to the tune of more than $20 billion, while doing so at a faster rate than the original plan called for.
“We think we can take our target up. But we’re looking at that right now, in terms of the overall economics of doing that,” Strigl said at a Deutsche Bank conference in New York. “We’ll pass 12 million by the end of this year, 15 million the next, 18 million the next. I think even within that same time period, there may be some upside for us in number of homes passed without significantly changing the capital requirements.”
Verizon’s FiOS rollout was initially slower than expected due to a lack of equipment, such as set-top boxes, as well as the regulatory approval process in the states where the telco wanted to rollout the triple-play service.
While FiOS currently has an edge with Internet speeds in some areas where it competes with cable operators, DOCSIS 3.0 wideband deployments by MSOs are expected to level the playing field.
DOCSIS 3.0 can achieve downstream speeds of up to 160 Mbps by bonding 6 MHz – or in the case of Europe and some parts of Asia and Latin America, 8 MHz – channels together. DOCSIS upstream channel bonding can provide up to 120 Mbps of shared throughput for cable operators.
Expect cable operators to aggressively deploy downstream wideband services in areas where they compete with Verizon’s FiOS service. FiOS has deployed its 50 Mbps downstream and 20 Mbps upstream service in six markets to date. The cost of Verizon’s 50 Mbps service is 89.95 in New York and $139.95 in Massachusetts, New Jersey, Florida, Rhode Island and Connecticut.
At the NCTA show in New Orleans last month, panelists Jill Campbell, Cox’s SVP of operations, and Michael Doyle, Comcast’s president of the eastern division, both said that Verizon has done a job with softening the markets up with advertising prior to the launch of FiOS services. Campbell said Verizon also was effective with its door-to-door campaigns in neighborhoods, but Charter CTO Marwan Fawaz said the four- to eight-hour installs by Verizon was not a pleasant experience for the company’s customers.
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