Frontier Communications might be looking to upgrade selected areas of its network to deliver fiber-to-the-neighborhood service as early as the last quarter of 2012. For a company that now owns some FiOS access lines as a result of its purchase of Verizon Communications assets, the move isn’t surprising.
The debate about the benefit and cost of “fiber to home” versus “fiber to neighborhood” was a big deal a decade ago, and recent experience tends to suggest Verizon Communications has found operating cost savings and new revenue for its FiOS network to be less than it hoped would be the case.
To be sure, the business backdrop has changed significantly since cable companies and telcos began sparring about the “best” architecture for fiber access networks. Cable companies and AT&T consistently have argued that hybrid fiber-copper networks were more economical, a debate that began decades ago.
The new angle, though, is the shift to wireless as the driver of most of the telecom industry'[s revenue in North America, and the relatively modest revenue contributions broadband access and video entertainment have made to telco revenue statements.
For Frontier, a company with lots of rural access lines, a hybrid approach arguably “always” has made more financial sense, given the cost of upgrading low-density areas, and the relatively modest new revenue upside.