From the NXTcomm conference in Chicago comes news that Verizon has signed up its millionth fibre-optic broadband customer, while its FiOS TV service is approaching half a million subscribers across the United States, making it one of the largest IPTV deployments in the world. Their commitment to a full fibre-optic system could be critical, as AT&T is lagging in the rollout of its less capable U-Verse service.
Launched in September 2005 and now available to almost 3 million homes in 11 states, Verizon aims to extend its FiOS fibre-optic broadband and television network to reach 9 million homes by the end of the year and 18 million by the end of the decade. It now has nearly 500,000 television subscribers, up from 348,000 at the end of the first quarter.
“DSL got us into the internet business,” said Verizon chief executive Ivan Seidenberg. “Fibre puts us in the TV and multimedia business — with faster internet speeds, higher-quality high-definition content and more interactive capabilities than any other platform, plus the ability to grow as customers find creative ways to use this new medium.”
To prove the point, Verizon produced a video featuring a family that they are claiming as their millionth fibre customer, a convert from Cablevision on Long Island in New York. Cablevision called it a transparent publicity stunt.
Five years ago, Verizon had 1.6 million broadband customers and less than 10% of telecom revenues came from data, commented their chief executive. “Today, we have over 7 million broadband customers, hundreds of thousands of video subscribers, and — for the first time in a long time — consumer revenues are growing.”
Verizon has elected to use traditional cable television technology over its fibre network. “We didn’t have time to wait for the IPTV technology to mature before we deployed,” explained their chief technology officer, Mark Wegleitner. However, Verizon is expected to migrate to a pure internet protocol infrastructure in the future.
Verizon is moving from megabits to gigabits. Verizon will begin to use GPON passive optical networking technology in all FiOS deployments, which will increase speeds downstream by four times and upstream by eight times.
AT&T has meanwhile been slow in the deployment of its U-Verse service, only signing up about 40,000 subscribers since it launched last year. Newly appointed chairman and chief executive Randal Stephenson said they are currently installing 600 customers a day and expect to be adding 10,000 a week by the end of the year, passing 18 million homes by the end of next year. “Our goal is to have the biggest video footprint of any of our competitors in 22 states,” he said.
AT&T, avoided the more costly fibre-to-the-premises approach, providing fibre only to the nearest node, but will ultimately find it harder to compete in access speeds.
Speeds of 100Mbps, comparable to a standard office network, are likely to become increasingly common. Cable companies are already planning to shed analogue television channels and use the capacity to offer higher broadband bandwidth by bonding channels to offer speeds of up to 150Mbps. Fibre has the capacity to reach 1Gbps or more.
Convergence and increasing bandwidth of network connections was a key theme of the conference. John Chambers, the chief executive of Cisco Systems, predicts that demand for bandwidth will grow up to 500 per cent a year over the next few years.