Recently U.S. carrier AT&T announced that it's DSL-based U-verse IPTV service had hit the 18,000 subscriber mark, with a current run rate of about 2,000 new subscribers a week.
According to Pyramid Research, the announcement gave way to the now inevitable comparisons against Verizon's fiber-to-the-home (FTTH) deployments. Verizon will spend $18 billion between 2004 and 2010 to fully deploy its FiOS service. By contrast, AT&T plans to spend $5 billion on rolling out a lower investment architecture built around "fiber to the node" and ADSL.
The notoriously short-sighted U.S. stock market investor has appeared to prefer AT&T's plan -- financially, it is more conservative than Verizon's push, and its payback period is much shorter. In contrast, according to Pyramid's assessment, in this high-stakes game Verizon's FiOS bet is the least risky of the two.
However, I believe that Pyramid's comparison of the Western European market is without merit. It's apparent that an open free-market approach to incumbent infrastructure utilization has given carriers in the region a sustainable business and technology advantage -- when compared to the closed duopoly of the relatively under-regulated U.S. market.
Therefore, it's my opinion that the lack of a decisive U.S. policy means that continued NGN global leadership from the Asia-Pacific and European markets is virtually assured.
Pyramid's analysis summary includes:
- Verizon's and AT&T's fiber rollouts are two antithetic bets on the evolution of broadband supply and demand. Verizon is taking a risk that is primarily financial; AT&T is taking a risk that is primarily strategic.
- AT&T's bet is the riskiest, because the long-term strategic and financial consequences of being wrong are much greater.
- The Verizon vs. AT&T contrast also makes for an interesting juxtaposition with what is happening in Europe. What was the basis of Western Europe's strong broadband growth over the past few years, local loop unbundling and increased competition, will be the source of its falling behind in the next-generation network (NGN) era.
According to Pyramid Research, the announcement gave way to the now inevitable comparisons against Verizon's fiber-to-the-home (FTTH) deployments. Verizon will spend $18 billion between 2004 and 2010 to fully deploy its FiOS service. By contrast, AT&T plans to spend $5 billion on rolling out a lower investment architecture built around "fiber to the node" and ADSL.
The notoriously short-sighted U.S. stock market investor has appeared to prefer AT&T's plan -- financially, it is more conservative than Verizon's push, and its payback period is much shorter. In contrast, according to Pyramid's assessment, in this high-stakes game Verizon's FiOS bet is the least risky of the two.
However, I believe that Pyramid's comparison of the Western European market is without merit. It's apparent that an open free-market approach to incumbent infrastructure utilization has given carriers in the region a sustainable business and technology advantage -- when compared to the closed duopoly of the relatively under-regulated U.S. market.
Therefore, it's my opinion that the lack of a decisive U.S. policy means that continued NGN global leadership from the Asia-Pacific and European markets is virtually assured.
Pyramid's analysis summary includes:
- Verizon's and AT&T's fiber rollouts are two antithetic bets on the evolution of broadband supply and demand. Verizon is taking a risk that is primarily financial; AT&T is taking a risk that is primarily strategic.
- AT&T's bet is the riskiest, because the long-term strategic and financial consequences of being wrong are much greater.
- The Verizon vs. AT&T contrast also makes for an interesting juxtaposition with what is happening in Europe. What was the basis of Western Europe's strong broadband growth over the past few years, local loop unbundling and increased competition, will be the source of its falling behind in the next-generation network (NGN) era.