Media

Verizon slows down expansion of its FiOS fiber network

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Verizon is looking to end the expensive roll out its FiOS service — which delivers high-speed internet, television, and phone service to millions of subscribers across the East Coast. The company will finish up its FiOS expansion in certain major markets, but those that haven’t received it yet are most likely out of luck, according to the AP.

The company is still looking to bring FiOS to communities where it has secured “franchises” — the rights to sell TV services that compete with cable. Specifically, it will continue bringing new fiber to homes in New York City, Philadelphia, and Wahington, D.C. Other major cities like Boston and Baltimore will be left without any FiOS availability. Its seeking out franchises in small communities –  mainly throughout New York, Massachusetts, and Pennsylvania — but won’t be doing the same for other major urban areas.

A combination of factors likely led to Verizon’s decision. To wire a city for FiOS, Verizon has to replace its copper telephone cabling with fiber optic cable, which is a time consuming and expensive process. It costs Verizon about $750 a home to wire a neighborhood, and another $600 to actually connect homes to its network. Such an expense was already an issue with Verizon’s investors in 2004, and with the recession its become even less attractive. The company is also nearing (and may exceed) its initial goal of getting FiOS to 18 million homes by the end of 2010.

The FiOS slowdown could be seen as bad timing for Verizon though — given the growing importance of broadband internet access in America with the National Broadband Plan, and Google’s own plans to roll out a fiber network in certain U.S. markets. It certainly deserves credit for being an early adopter of fiber technology, but it seems odd to slow down its roll out now that others are catching up.

People still want fiber service in their neighborhoods — as the 600 community responses and 190,000 individual responses to Google’s fiber service show. Verizon hasn’t ruled out continuing its FiOS expansion in the future, but for now it seems that many who want fiber may have to wait for Google or the federal government to make it possible.