Mark Wegleitner, Verizon's chief technology officer, has been championing this strategy for the past three years. The network, called Fios, takes fiber directly to the side of people's homes and provides near-limitless bandwidth that can be used to deliver a "triple play" of services including high-speed Internet connectivity, telephone service and TV. The company already offers Internet service that runs at 50 megabits per second. And it's testing service at 100Mbps.
The largest phone company in the U.S., AT&T, has taken a different approach, only deploying fiber farther into neighborhoods and using existing copper to deliver it the "last mile." Wegleitner and other Verizon executives were adamant that a fiber infrastructure, in the long run, would be better. Critics of the strategy said that the budgeted $18 billion to build the network was too expensive. But with more than 1 million Fios Internet customers and nearly 500,000 Fios TV customers signed up, it looks like Verizon's strategy is working.
Wegleitner recently sat down with CNET News.com to explain why the company chose this aggressive route, and where he expects the company to go from here.
Q: You and AT&T are upgrading your networks to deliver TV services so you can compete against cable operators. AT&T has chosen to take fiber to the curb or neighborhood, but Verizon is spending billions to bring it to people's doorstep. Why?
Wegleitner: There are pros and cons to every technology. In our analysis, we saw that bandwidth demand seems to be going nowhere but up. And we think in the future that more people will be using Internet technology concurrently. It won't be just one PC surfing the Web to check a flight status. More people in the home will be online at once, and it will be a full multimedia experience. The Internet will become the delivery mechanism for entertainment, especially video and other related entertainment. So we needed to develop a network that was robust and flexible. And we wanted to put in a physical infrastructure that we wouldn't have to dig up for another 15 years. We came to the conclusion that fiber-to-the-home was the only infrastructure that would give us the necessary headroom.
So do you think AT&T's strategy of extending fiber loops only as far as the neighborhood and using existing copper infrastructure to deliver advanced DSL services was the wrong choice?
Wegleitner: I wouldn't say that AT&T has gotten it wrong. DSL is a good technology. Our concern was more about what happens a few years out. And that's why we picked fiber. And I can't really predict how other technologies will grow, but we know that fiber gave us the headroom we needed.
I just want to make it clear though, I think AT&T is on a path that has a lot of promise. As I said before, there are pros and cons to every technology. And we weighted some of these things differently than they did. We also didn't want to wait for the IPTV technology or the VDSL 2 technology to mature. BPON technology (which is the technology used to deliver data over fiber) was already pretty well understood. And that also factored into our decision process.
Right now, Fios TV is based on a hybrid of technologies. It uses IP to deliver interactive services like video on demand, and regular broadcast programming is delivered over what looks like a traditional cable infrastructure. But you've said that you see this overlay broadcast network eventually going away and Verizon will use an all-IP network to deliver all video. So why move to IP if what you're doing now works?
Wegleitner: There are a few reasons for us to move to IP. It brings certain capabilities that aren't as easily provided through a traditional linear network. The classic example that's used for IPTV is offering multiple camera angles for sporting events. The other thing is that IP will allow us to offer a nearly unlimited number of channels and content packages. And because all this content is delivered over a homogenous network, it makes it easier and cheaper to add new content and services. It's also easier to manage.
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