fiber NID

With the two largest fiber broadband providers in the country, Verizon and AT&T, reporting on 3Q 2020 results, we get visibility into fiber broadband momentum, or lack thereof. The news looks promising, as those two carriers alone saw close to 500K net adds for fiber.

AT&T reports it now has 4.7 million fiber subscribers, adding 357K net new fiber subscribers in 3Q 2020, up over 12% from 3Q 2019. AT&T now reports 33% penetration of its fiber homes passed.

Verizon reported 139K net adds for consumer Fios fiber subscribers, the most net additions since 4Q 2014. That’s up over 450% from 3Q 2019. Verizon now counts 6.1 million fiber subscribers.

Fiber Broadband Momentum

The current pandemic has certainly played a role in this momentum, as broadband’s role as an essential service has been magnified. The dramatic increasing demand for upstream bandwidth as more people work and study from home makes symmetrical fiber broadband more attractive.

For AT&T’s part, the carrier still has a lot of room to grow its fiber footprint. During the Q&A session of today’s AT&T 3Q 2020 earnings call this morning, an analyst pointed out that AT&T reaches about 60 million homes, but only passes about 14 million with fiber.

AT&T CEO John Stankey suggested that some changes to policy, including changes to the Universal Service Fund, could help AT&T reach more homes with fiber. He didn’t elaborate on what changes he would like to see, but an AT&T policy opinion earlier this year suggested the program should be reformed to include direct funding from Congress.

“I believe some of these architectures that are coming out, and frankly if policy gets right, that you can open up some of these places for growth,” said Stankey about AT&T fiber broadband momentum. “If the universal service program gets reformed in an effective fashion, which I think it’s time, that from a policy perspective in our country, we should look at that, it makes fixed broadband more affordable.”

Both AT&T and Verizon are on a path to migrate their FTTP technology to next-gen fiber platforms. Verizon is on a path to NG-PON2, while AT&T is pursuing XGS-PON. Both of those technologies put fiber providers on a path to 10G capable service, a path that their cable competitors are also pursuing.

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