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FiOS Speeds & Prices Take a Quantum Leap

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
6/18/2012
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Verizon Communications Inc. (NYSE: VZ) has launched and set the price for its new, high-end FiOS Internet tier, which tops out at 300Mbit/s downstream and 65Mbit/s upstream and sells for $204.99 per month with a two-year contract, or $209.99 per month without.

The new tier, offered under Verizon's new FiOS Quantum brand, ensures that Verizon FiOS continues to outpace U.S. cable's current crop of Docsis 3.0 cable modem services.

The 300Mbit/s tier doubles the downstream speeds of its previous, high-end tier. The company's 300Mbit/s and 150Mbit/s tiers are available only to Verizon customers connected to a GPON terminal. Anyone on a BPON terminal who qualifies for the GPON services will require a new terminal. When Verizon announced the speeds of the new tiers in late May, it noted that the "majority" of FiOS customers qualify for the two top FiOS speed tiers.

Verizon has retained its entry-level tier, which supports 15Mbit/s downsteam by 5Mbit/s upstream and won't carry the Quantum name. The carrier has also replaced and at least doubled the speeds of its previous 25Mbit/s and 35Mbit/s tiers. And they'll pay a bit more, too. Verizon acknowledged that most FiOS bundle customers will pay $10 to $15 more per month, but said they may be able to tweak their FiOS TV tiers to pay roughly the same monthly total that they pay now.

Here's how the rest of the lineup stacks up:

  • 150/65 Mbit/s: Triple-play bundles range from $169.99 to $174.99 per month for new FiOS subs; double-play bundles with FiOS TV go for $154.99 to $159.99. The 150-meg tier sells for $94.99 as a standalone with a two-year contract or $99.99 per month on a month-to-month basis.

  • 75/35 Mbit/s: Triple-play bundles range from $114 to $154.99 per month, and double-play bundles with FiOS TV run from $99.99 to $139.99 per month. The standalone sells for $84.99 per month with a two-year contract or $89.99 per month without.

  • 50/25 Mbit/s: Triple-play bundles sell in the range of $109.99 to $149.99 per month for new customers, with double-play bundles (again with FiOS TV) going for $94.99 to $134.99 per month. The standalone service goes for $74.99 per month with a two-year contract or $79.99 per month without.

  • 15/5 Mbit/s: Double-play bundles range from $84.99 to $129.99 per month, while the standalone service costs $64.99 per month with a two-year contract or $69.99 without.

Why this matters
Although few customers are expected to take the two top tiers, the existing 150Mbit/s offering and newer 300Mbit/s service will continue to give Verizon FiOS bragging rights over the fastest Docsis 3.0 tiers offered by U.S. cable operators. Among the cable competition, Cablevision Systems Corp. (NYSE: CVC) sells a 101Mbit/s service for $104.95 per month, while Comcast Corp. (Nasdaq: CMCSA, CMCSK) has rolled out a 105Mbit/s tier that sells for $199.95 per month. Time Warner Cable Inc. (NYSE: TWC) has yet to breach the 100Mbit/s mark with a residential cable modem service; its current high-end "Ultimate" tier tops out at 50Mbit/s downstream.

But cable does have the technical capability to match or exceed the present FiOS lineup, at least in the downstream. Current-generation Docsis 3.0 modems can bond eight 6MHz-wide channels -- enough for maximum bursts of 320Mbit/s. The latest D3 chip from Intel Corp. (Nasdaq: INTC) can bond 24 channels and start to approach max speeds of 1Gbit/s. Broadcom Corp. (Nasdaq: BRCM) is said to be working on a 32-channel Docsis 3.0 chip that will be capable of speeds of about 1.2Gbit/s.

For more


— Jeff Baumgartner, Site Editor, Light Reading Cable

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msilbey
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msilbey,
User Rank: Blogger
12/5/2012 | 5:30:00 PM
re: FiOS Speeds & Prices Take a Quantum Leap


It's fascinating to watch the dichotomy of cable/telco operators bragging about 100MB service (or 300MB in VZ's case) vs. the multiple communities now toying with gigabit municipal broadband. It's logical in some sense because you need experimental ground to develop the apps that will actually take advantage of gigabit speeds. On the other hand, there's a big difference between not only the average Internet tiers users get, but even the speeds quoted in the marketing wars compared to new gigabit offerings. Interesting disconnect. 

Jeff Baumgartner
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Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:29:58 PM
re: FiOS Speeds & Prices Take a Quantum Leap


Seems as though 300Mbit/s is just a weighstation toward the next big target of 1Gbit/s, whether many people actually need or use that sort of bandwidth anytime soon. It's mostly about bragging rights and numbers the marketers can wield at this point.


However, Verizon's pitching the idea that consumers will need more and more bandwidth to feed connected devices in the house that might be trying to access video contant at the same time. I buy into some of that, and maybe moreso when there's alot more OTT HD streaming going on.  I still have a 12-meg Docsis connection and it seems to be doing the job at the moment, or at least I haven't found a reason yet to shoot for a D3 tier. But I'm just one example.


I think at this juncture a big selling point for Verizon FiOS Internet isn't just speed but the fact that it's  uncapped and that there appears to be no near-term plan to try out usage-based consumption. Then again, some users are paying a bit more for this uplift in speed, so it sort of balances out. But at least FiOS users don't have to worry about monitoring their consumption. JB

AESerm
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AESerm,
User Rank: Light Beer
12/5/2012 | 5:29:57 PM
re: FiOS Speeds & Prices Take a Quantum Leap


So VZ is suggesting that subs tweak their TV tiers so as to keep prices level while increasing data speeds? Does that mean consumers cutting back on premium channels? Or just VZ reducing its price of the TV tier? Either way, sounds like another example of TV programming losing a bit of its value.

somedumbPM
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somedumbPM,
User Rank: Light Beer
12/5/2012 | 5:29:57 PM
re: FiOS Speeds & Prices Take a Quantum Leap


Aren't gigabit municipal broadband projects built upon the same business case as the municpal wi-fi projects?  Google built at least one of those too if I recall.  I do not believe any of them broke even and thus they will not be supported by private industry that often, but more often supported by our tax dollars or those with disposable income -like Google. 


Outside Plant isn't sexy and everyone takes it for granted, but that is where all the costs and timesinks are at.


I believe 300Mb is the access connection and they are connected at a Gig -unless there is some new interface I don't know about. Is there a 300PON or 1/3GPON a 300FX? -hehe, really is there.......?


I do not see this being needed by a significant portion of consumers for a while.  Today this would be a good size circuit for a large number of business if it were symmetrical and even in its current form for many. 


I really do not think many people know how much they use.  I monitor some offices with hundreds of people in them that do not come close to maxing that usage.  Then there are some offices with 5 people 1 busy server that would max it 24/7 -but that is not consumer.

craigleddy
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craigleddy,
User Rank: Blogger
12/5/2012 | 5:29:56 PM
re: FiOS Speeds & Prices Take a Quantum Leap


100 megs, 300 megs, 1 gig -- as a consumer, will I really be able to see that much difference? Or is this like taking a drink of water from a firehose? 


I agree that these high-speed tiers look better as a business option than one for consumers. I know some households probably need a lot of bandwidth for their Internet video, but it seems a long way off for most consumers to be able to justify paying these VZ prices.


 


 


 

jobenso
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jobenso,
User Rank: Light Beer
12/5/2012 | 5:29:55 PM
re: FiOS Speeds & Prices Take a Quantum Leap


I got this yesterday, it's fast, realy fast. I locked up my BHR (mocha router) yesterday, I have to wonder if the built in cache is enough for this MSO provided device. Also mocha Ethernet-in would be an issue for anything above 75 Mbit/s, I don't think you could achieve 150 Mbit/s.I dropped voice, upgraded the internet and kept the same TV package and saved $5.00.

msilbey
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msilbey,
User Rank: Blogger
12/5/2012 | 5:29:52 PM
re: FiOS Speeds & Prices Take a Quantum Leap


somedumbPM- Chattanooga is a success case for gigabit broadband. Also, take a look at what Gig.U is doing to make gigabit cities sustainable: http://www.smartplanet.com/blog/thinking-tech/200-million-funds-new-gigabit-neighborhood-gateway-program/11730

Rush21120
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Rush21120,
User Rank: Light Sabre
12/5/2012 | 5:29:51 PM
re: FiOS Speeds & Prices Take a Quantum Leap


I seem to recall FIOS has a symetrical 20/20 for $70-75 (?) as well.  Whatever happened to that service.

somedumbPM
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somedumbPM,
User Rank: Light Beer
12/5/2012 | 5:29:50 PM
re: FiOS Speeds & Prices Take a Quantum Leap


Ok your definition of success and sustainable may be different than mine, but from a business case there is no break even as of yet - as the article you linked eludes to:  "But he does believe that with this early experimentation it will be possible to create a sustainable and replicable model that can be adapted for different region’s specific needs in the future."  Even with the combination of donations of gear and govt grants the model is not self sustainable at this point.


A funny coincidence is that I was involved in a project to bring 2-10Mb service to Chattanooga over 10 yrs ago via a carrier and the demand was not there.  We built and tested it across the geographic area and no one cared.  There were subs, but not enough to maintain the infrastructure which required very little operational expenses to keep going.


I find that Gig connectivity is used mostly as a marketing term in these projects.  As you start digging into the technical details of what you actually want to connect to, and where the service is oversubscribed, you eventually have to leave happy funtime dreamland and face the reality of engineering and business. 


Don't get me wrong I want networks with this capacity to the edge to be a reality (most of us on here would benefit from it!) and they will one day.  These projects are indeed one of the stepping stones to get there, but right now I don't believe the hype.  I believe what can be shown to me like network diagrams and P&L charts.  I doubt there is any evidence of a sustainable model at this time though and I would not feel bad about being proved wrong, actually I would be pleasantly surprised.

MMQoS
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MMQoS,
User Rank: Light Sabre
12/5/2012 | 5:29:41 PM
re: FiOS Speeds & Prices Take a Quantum Leap


Msilbey:


You may find it fascinating and I can see your point, but as I posted to another LR story this week, this develpment just makes me more dismayed at the dismal BB service available to my office.  I am a resident of a technology center, the "Birthplace of Silicon Valley" and having worked on GPON in FSAN and ITU-T while with Nortel, but I still cannot access the kind of service discussed in this forum from the largest US telco, ATT.  Their internet access offering doesn't even approach 100 Mbs let alone 1 Gig.  For me the ironic point is that SBC, now ATT Labs architects were prime architects for the GPON design.  Our city, Palo Alto has experimented with FTTH but SBC fought the project all of the way and it is now on life support for lack of funding.


A lot of my neighbors have now dropped ATT broadband for Comcast and unless ATT provides FTTH service soon I will be doing the same as these new high b/w applications are developed.  I've been hesitant to rely on an MSO infrasturcture for critical data but my neighbors are reporting very good QoS.  Google is providing their experimental FTTH a mile away on the Stanford campus and hopefully it will be expanded here.  


MMQoS 

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