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Fiber is good for you

I’ve been patiently waiting to get FiOS, Verizon’s new fiber optic residential network, since February. It’s really bugging me because I know they ran fiber to a box on the corner of my lot last year, but they’re still not offering the service to me yet.

Anyways… Verizon stockholders weren’t too pleased when Verizon disclosed just how much they were spending on building their nationwide fiber optic network – a whopping $22.9 Billion. While the number is staggering, if you step back and take a look at it, it doesn’t look that bad in the bigger picture. They plan on saving $4.9 billion through 2010 by not having to repair aging copper lines. The more important number is that they expect FiOS will become profitable by 2009. That may sound like a long way off, but once completed, Verizon will have the most advanced physical terrestrial network in the country. They’ll be able to offer voice/data/TV all through their single pipe, and with bandwidth being essentially unlimited, they’ll be able to provide pretty much any service they can dream up. Talk about competitive advantage. Satellite TV won’t be able to compete. Cable TV won’t have the bandwidth to offer everything they can’t. The best alternative bet is on wireless companies to provide high speed data services, but until I actually get a cell phone that is crystal clear and never cuts out when I walk through different rooms of my house, I’m not going to bet on that technology.

AT&T is trying the cheapout approach by running fiber only to a locality, and then relying on their existing copper lines to connect to the homes. It’s a patchwork system that will never work long term, and they’ll end up wasting a lot of money to only go full FTTP later on. Maybe they figure that at that point it will be cheaper to run fiber, but they may have lost too much market share by that point to catch up. Somewhere at AT&T, there’s a guy who’s just waiting to say, “I told you so!”

So come on, Verizon. I’m itching to try this out. I’m really itching to have enough bandwidth to switch to a VoIP phone service and save myself like $25/month too. I’ll be your biggest cheerleader. Hook me up!

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  1. I vaguely remember Verizon receiving a couple of hundred million in federal subsidies for this project as well. Do you remember that or am I dreaming?

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