Verizon Fueling North American Fiber Growth

Verizon Communications Inc. (NYSE: VZ) appears to be almost single-handedly introducing fiber to the lives of consumers in North America. (See FTTH Subs Hit 1M.)

According to a study presented Thursday by the Fiber-to-the-Home (FTTH) Council and the Telecommunications Industry Association (TIA) , fiber optic cable is now available to 6 million North American homes. Verizon is responsible for 5.5 million of those, according to Verizon numbers. (See Verizon to Pump $18B Into FiOS by 2010 and Figuring FiOS.)

The other key point from the study is that about 1 million homes in North America have been connected to the fiber. Verizon has about half of those; the carrier says it passed the 500,000-subscriber mark at the end of the third quarter. That's up from just 375,000 FiOS customers hooked up at the end of the second quarter.

"We expect to hit six million at year's end...in parts of 16 states,” a Verizon spokesman tells Light Reading. “Our run rate for the foreseeable future will be to pass 3 million more prems annually.”

The TIA and FTTH Council say that more than 300,000 additional homes are now being served with fiber every month, and acknowledge that Verizon accounts for most of them.

“They’re obviously a big part of it,” says Michael Render of the fiber optic research and consulting firm RVA Render & Associates, the firm that conducted the new study. "If you break it down, in the past year the RBOCs -- and Verizon is obviously a big part of that but AT&T is also just getting started in the development space -- their numbers have grown by about 370 percent over the past year, and the number of homes connected by everybody else has grown by 100 percent, roughly." “Everybody else” here means public utilities, CLECs, municipalities and real estate developers, Render explains.

The Verizon FiOS crews were apparently very busy this summer. "Up until this summertime it [FTTH growth] was 50 percent Verizon and about 50 percent the other hundred-or-so providers that have deployments in place, FTTH Council president Joe Savage tells Light Reading. "But since then Verizon has been passing homes at a rate of 3 million a year, while the rest of them are passing between 1-2 million homes a year."

Large telcos will continue fueling the majority of the growth over the next year, RVA's Render believes, with public utilities and developers contributing marginally more. “Municipalities are still slow because of the regulatory hoops they have to go through at various levels, but independent telephone companies and developers are getting more active at the moment.”

AT&T says it will bring fiber out to the nodes in the neighborhoods of 18 million U.S. homes in 2008. Copper will be used to go the rest of the way. AT&T says it will run fiber all the way to the premises of another million newly-built residences. (See Is Lightspeed Slowing?.)

— Mark Sullivan, Reporter, Light Reading