Yes, FiOS was a Good Idea

I find the debate over FiOS to be incredible. Some Investors didn’t think the investment made sense and analysts even say there will be no way to get the investment in fiber to the home (FTTH) paid back.

What these arguments miss is the point. Consumers want faster and faster connections to the internet and this will only become more of an issue as homes get even more computers and internet connected devices.

Remember that the latest televisions at 1080p can provide a viewing experience which broadcasters are yet to support. This trend will likely continue — hardware vendors will get farther and farther ahead of broadcasters. As it does, consumers will begin to opt for programming which is provided exclusively over very fat pipes.

These fat pipes will compete with the TV delivery of cable and phone companies mind you but that is a different angle on this story I will not delve into at the moment.

If consumers pay thousands more for TVs which are capable of showing higher quality programming, won’t they also pay for higher quality programming? The answer to me is is certainly yes. This means there will be incentive for broadband-only super HD channels to exist.

We can also expect virtual world use to increase and this could be another driver of large amounts of bandwidth.

In short, applications which suck up bandwidth at once preposterus speeds are being invented constantly. Soon, the company which provides the fastest broadband speeds will have an amazing advanatage over others.

Just as Verizon Wireless is doing a great job of taking share with a fast and broadly available wireless broadband network, expect FiOS to become a bigger differentiator as consumers start to clamor for gigabit plus download speeds.

The only concern of course is WiMax and BPL — but neither of these technologies seem to be capable yet of gigabit per second speeds which the future will call for.

Check out this DSL Reports article for more.

  • Sean Hsieh
    August 21, 2008 at 12:37 pm

    I think you make a very good point, and from the first glance, yes, you’ll always want a fatter pipe to send down bigger data, but there’s also the case of compression, which is only getting better. Most HD broadcasts are all h264 more, which is able to send out large sums of information without requiring insane speeds. I don’t think WiMax will have that much to worry about because by the time it is able to achieve mass adoption, HD videos will probably already receive a very formidable compression method to portable devices. I don’t believe WiMax’s intent was to stream video in the first place, but with a theoretical 70mbit/sec max, it will prove just fine. Even with the 2mbit/sec soft launch, you’ll be able to stream enough resolution to your hand held devices without a problem. And I’m pretty sure FiOS wasn’t designed to compete against WiMax. BPL on the other hand will definitely hit a threshold fast and does not have the same capacities of optic fiber.

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