Verizon Leads the Great 100-Mbit/s Bandwidth Race

Verizon is gearing up for 100 Mbit/s to be a common offering for most homes. Will AT&T follow suit?

Raymond McConville

November 1, 2007

3 Min Read
Verizon Leads the Great 100-Mbit/s Bandwidth Race

With Verizon Communications Inc. (NYSE: VZ) announcing a five-fold increase in the amount of HD channels on FiOS TV next year, it again brings to light that consumer bandwidth is a growing concern. (See Verizon to Quintuple HD Channels.)

And, in the U.S., Verizon is the only major carrier betting consumers will want 100 Mbit/s to their homes in the near future.

"Just a short time ago we didn't think we'd be selling 50 Mbit/s but we're selling it today," says Verizon spokesman Mark Marchand. "The market is clearly not demanding 100 Mbit/s right now, but do we think it will evolve there? We do."

Verizon may already be preparing its network for one day delivering that 100-Mbit/s bandwidth to each home. For example, Russ Sharer, VP of marketing for Occam Networks Inc. (Nasdaq: OCNW), says he has heard that this involves designing PON splits of only 24 homes instead of the standard 32.

On a 2.4-Gbit/s GPON network, a 24 home split would deliver exactly 100 Mbit/s into each home.

Verizon confirms that there are situations where it does splits of only 24, but it has not necessarily become its standard practice: "We've always said that the network splits are up to 32 homes," says Marchand. "There are many cases where we don't do the split up to 32."

Marchand notes that Verizon could re-engineer the PON at any time to meet changing demands and that they believe this demand will eventually evolve into 100 Mbit/s. So while Verizon is not necessarily installing GPONs with 24 home splits everywhere, it has the flexibility to easily adapt to it should bandwidth demand surge that high.

Verizon currently offers 50 Mbit/s in select markets in Connecticut, Florida, Massachusetts, New Jersey, New York, and Rhode Island. It is currently testing 100-Mbit/s service in employees' homes.

FiOS currently runs mostly on BPON which delivers 622 Mbit/s. On a 32 home split, that comes out to a hair under 20 Mbit/s to each home, which is the standard offering in many markets where FiOS is available.

But while Verizon will likely one day increase this to 100 Mbit/s, AT&T doesn't appear to have moved much from its position over a year ago when it said 25 Mbit/s would be more than adequate for the foreseeable future. (See AT&T on Bandwidth.)

"We have a path to deliver more bandwidth with compression and copper pair bonding," says AT&T spokesman Wes Warnock. "But also the key benefit of an IP multicasting model is that you're delivering video on an on-demand basis."

While the on-demand nature of IPTV does make it possible to deliver more content with less bandwidth, Warnock would not go so far to say that AT&T doesn't have 100 Mbit/s on its radar. But recent comments by an AT&T executive at the TelcoTV conference suggest that the company still has no plans to move beyond the 25 Mbit/s it currently delivers to each home. (See AT&T Shows Off IPTV Tricks.)

At the show, AT&T Labs Executive Peter Hill reiterated the company's stance that advancements in compression and video encoding technology were ahead of schedule and would continue to allow the company to satisfy the bandwidth crunch.

Meanwhile, Qwest Communications International Inc. (NYSE: Q) is taking the most conservative approach of all. It is also rolling out an FTTN network capable of 20 Mbit/s speeds although it said this week that it may be doubled through the use of pair bonding. (See Qwest to Spend up to $300M on FTTN.) As of now though, Qwest has no plans to deliver video over those FTTN lines.

— Raymond McConville, Reporter, Light Reading

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