Verizon’s FiOS Broadband and TV service is widely believed to be kryptonite for Cable Companies. Add satellite companies to the list, according to a study conducted by OneTrak, a market research firm. They looked at 34 Massachusetts towns and came up with interesting conclusions. In the first 90 days of the FiOS availablity, this is how the losses stack up:
1. Comcast lost 5,216 subscribers across a base of 204,160, a drop of 2.6%.
2. RCN lost 1,813 subscribers, or 7% off its base of 25,895 subscribers.
3. 4,594 FiOS TV subscribers came from DirecTV/DISH, or about 40% of their total subscriber base.
4. Verizon’s gain was 11,982 subscribers.
OneTrak believes that “Verizon will likely continue to see double-digit penetration gains in markets where it launches FiOS TV service.” No wonder Verizon is so bullish on FiOS and is betting the farm on the fiber.
Our good friend Cynthia Brumfield explains the satellite-to-FiOS swtich
Verizon is trying to convert its video subscribers that come through its DBS partnerships over to FiOS because that’s a very easy switch. Moreover, it has the added benefit of allowing Verizon to keep 100% of the video service revenues instead of sharing those revenues with DirecTV. So, a good chunk of Verizon’s FiOS TV customers ARE coming from DirecTV because they were part of the DirecTV customer base Verizon had anyway.
27 thoughts on “Who's afraid of FiOS?”
A similar effect is seen in The Netherlands where a new entrant called Reggefiber through its subsidiaries Lijbrandt and Onsnet is gaining market shares of 70% to 90% in the first year, by a combination of low prices (around 50/60 euro for triple play) and playing on a sense of community. One can truly say they are an instant monopolist.
They hope to hook up 150,000 households per year at an expense of 150 million euro for the next 10 years to gain a market share of over 1/7th of the Dutch market.
I can certainly believe that. FIOS has not yet rolled out to my town (I live in Massachusetts), but I will take a close look at it when it does. Right now the options are Comcast and Verizon DSL, which is not great, the latter is slow, the former has poor customer service, and the upstream speed is slow.
It makes perfect sense for the FiOS TV customers to come from DirectTV/Dish and that isn’t really news. Verizon is trying to convert its video subscribers that come through its DBS partnerships over to FiOS because that’s a very easy switch.
Moreover, it has the added benefit of allowing Verizon to keep 100% of the video service revenues instead of sharing those revenues with DirecTV.
So, a good chunk of Verizon’s FiOS TV customers ARE coming from DirecTV because they were part of the DirecTV customer base Verizon had anyway.
I just upgraded my Comcast to 8 megs down and 768 up for an extra $10. Upload speeds are good, worth the extra money.
I live in a Massachusetts town with FiOS access. On top of that I’m as geek as you can get, but for me FiOS is a lousy deal because my household doesn’t watch cable TV (we do get broadcast channels via our cable co’s “antenna service” plan). I suppose that we’re a minority.
I guess that no one really gets FiOS for it’s data speeds solely. That being the case, the 8 or 10 Mbps connectivity I get from my cable company is more than enough for anything I need, unless I consider hosting my personal web site at home. But, when I factor in how much it would cost (for electricity) to keep a computer on 24/7, it’s still cheaper to pay for a hosted solution.
And those are the details of my completely outlier case 🙂
Unless there’s been a sudden injection of neuron-producing stem cells into the beancounter brains running Verizon, the 40% of the country that lives in suburban or rural circumstances won’t have to consider the buying-in of FIOS vs. Anything Else for years, decades.
The company is still by the same Telco lamers who had to be pushed into spending more than petty cash to chase a profit. Any idea how far these clowns had to retreat before they moved into competitive tech?
I switched to FiOS from RCN and could not be happier. For less money than RCN — my former provider — I get a service that absolutely blows them away. The Internet speeds are blazingly fast, the picture quality and reception and fabulous, and even the phone calls sound nice. I’ve never been a big Verizon fan, but compared to RCN, their customer service is actually very good. The one downside is the amount of time to install the service — about 9-10 hours in my house.
I can’t wait for FiOS to hit the Bay Area…I will make the move immediately.
…a social network for sports fans.
while FiOS is great and all Verizon still suffers from horrible customer service. My experience of swithing over was one of the worse..FiOS TV has some growing up to do as well while it introduced things like widgets it still lacked basic features like page up and down??!
my full headeache review is here
Anyone have any idea when FIOS will come to New York City; specifically, Manhattan?
I have FIOS in MA after switching from Comcast. Here’s the real scoop. The Internet connection is blazing fast. I have 20Mb/sec. Downside, very few sites will talk to you at 20Mb/sec. Many are throttled down to lower speeds. But it is fun watching Bit Torrent work at 2,500KB/sec. 10Mb/sec is all you really need until the rest of the Internet gets faster.
TV is a bigger problem. I have 350-450 channels. I’ve never tuned to half of them. Hollywood and the “protected video path” is the source of my hatred. All of the channels on FIOS are encrypted. That means you have to have a set top box on every television. The purpose of this encryption is to make Hollywood happy and stop you from recording things using anything but a Verizon supplied DVR which encrypts everything. Verizion would immediately remove this encryption if Hollywood would let them. The customers hate having STBs on every TV. Every single FIOS customer is complaining about this.
With Comcast I had about 60 analog channels that were watchable without needing a STB. Don’t get too excited, as soon as your Comcast market goes all digital those analog channels will disappear and you’ll need STBs everywhere like FIOS.
I wish Verizon and Comcast would get together and tell Hollywood to get lost. Then they could turn off encryption and HDTV QAM tuners would work. We could the get rid of all the extra STBs.
Sure I know about CableCard. Let’s add $500 to the cost of TV just to keep me from recording content I’ve paid to watch. Besides, I’m not about to replace several brand new HDTVs.
Comcast is TERRIFIED of FiOS. The day I found out I could finally order it at my condo, Comcast sent two representatives to my house to talk to me personally about what great services they have.
I asked if they were there because of FiOS. One rep nodded yes while the other said no. I think I know which one was telling the truth.
They asked what gripes I had about my service. I told them I was unhappy that the NFL Network was pushed into one of their premium packages and that the Internet was slow (comparatively to FiOS at 20/5 as compared with 8/768kbps). They offered phone service, and when I wouldn’t take that lame piece of bait, they told me they couldn’t do anything for me. I ordered FiOS that night.
The next day I got a notice that Comcast was jacking the DVR fee $3/month. Considering I was getting more from FiOS for less money already, this was like a kick in the pants.
Finally, once FiOS was installed, I called Comcast to cancel. I expected a retention deal. Nothing, just some guy in India telling me to return the cable box (the equivalent of “don’t let the door knob hit you on the way out”).
So yeah. Comcast should be scared.
Unless I missed something…
Before we all get excited about Verizon and Massachusetts, it is clear that some of the numbers are missing or don’t really show progress.
In the story, there are 34 communities – we don’t know how many households or businesses there are in those communities. Then we are told that Verizon has 11,.982 customers — if you examine each of the parts where the data is presented, this represents 3 different companies – RCN, Comcast and Direct TV…
When those market numbers are added together we get 241,500 – and thus Verizon has less than 5% of the current market, excluding all those who don’t have phone and cable service. —
FiOS entry in Massachusetts doesn’t uniformly wound competitors
thanks for stopping by. I read the same report, and you are right to point out that while there is no uniformity when it comes to FiOS wounding the competitors, it is worthy to note that when given a choice, consumers tend to exercise it.
It is something we have forgotten in the days of duopoly, and we need more competitors to spur the growth of real broadband. Unfortunately FCC and the regulators have made it impossible.
I would love to see Comcast counter with its own better, and perhaps more sanely priced competitive offer as well.
It would be interesting if AT&T would implement the Bellsouth fiber solution nationwide at a reasonable price to compete with FiOS from Verizon.
I have fiber on my cul-de-sac, and I wonder how long it will take for Bellsouth/AT&T to realize the potential source of income…
I have FIOS in West Chester PA and love it.
However it is NOT true here that you need a set top BOX on every TV. I have 3 TV’s. Two are HD with HD DVR’s and one is just connected to a 20 year TV with a COAX cable connection in our guest room. There are 16 channels (local, and the verizon weather channel).
Eric, you are right. I have the basic broadcast channels available on analog. But this not what you expect to get when you sign up for this service. I am very unhappy about moving backwards from what I had with Comcast. It is annoying to put STBs into the exercise room, guest room, etc. There is no place to put one on the small TV in kitchen.
For example Red Sox games are only broadcast on channels needing a STB. None of the news channels are on analog either. QAM HDTV can only tune HD versions of same broadcast channels, everything else is encrypted. Can’t even get boring CSPAN without a STB.
I’m just mad about this unneeded expense and inconvenience solely to make Hollywood happy.
I also hate the STB’s. They are big and ugly, and I’m sure they add to my electric bill since they generate a lot of heat, even when they are “off”. Also they are $5/month each to rent.
I tried to switch back to comcast but they couldn’t get their act together in getting my phone number back from VZ. They blew 3 installations where the tech showed up, and said “gee, it says on the sheet that your number has been ported back, but I called and it’s not, so we have to schedule another installation”. Pretty soon my FiOS 30-day trial had expired and now I’m locked in.
This is also not to mention that the basic Comcast Internet was faster than the basic FiOS speed. I had to upgrade the FiOS service to 20 mbit for $10/mo more, since I work at home and use it a lot.
Does anyone know if I can at least buy my own cable box to avoid the rental fee, or get some kind of in-line decrypter to replace the box with?
Well, the FIOS upgrade blowup was horrible … I am looking to go back to Time Warner or DirecTV.
8/22 the upgrade happened. It locked up the basic box I had, and changed the functionality of the DVR and remote (the previous software used the buttons around the “select” button for play, fast-forward, and rewind and was not informed, so seemed like it was broken). Calling the support center, I was routed to “level 1 / upgrade support.” The women there were clueless, unable to listen and comprehend and basically morons (and I don’t use that term much). Both times I called for this, I had to be routed to another tech to get help. They were slightly better.
When I did get the upgrade resolved, the menus were bug ridden, slow, and difficult to understand.
o “Show Reminder” on the basic box is no longer there.
o The Guide cannot be adjusted to default to “favorites” list
o To get to the guide, you have to go thru the menus on the left side (obscure interface)
o There is a limit to the number of favorites you can program in
o If you select to use Favorites, it jumps to the top of the list and then need to page down
o Programming of a “series” next to impossible to figure out
– Actiontech router – Failed the wired connections one morning. Talked to the tech and tried to explain the problem. He said he would drop ship a router (work from home … not acceptable). I had to raise a stink to get him to send tech out. (Tech said they always bring out)
– Installed my own router in the meantime, to try to get back to work. This worked fine.
– Tech brought new Actiontech router – Did not work at all. Attempted to sort out with FIOS center, and had to call a few times. Eventually decided to try another.
– 2nd New Actiontech router – This worked when installed (tech did not know much about computers, which seemed odd for a tech helping me with a computer problem)
– Wireless connection with 2nd new router – initially spotty connectivity with it dropping connectivity. I did use the online connectivity, and this problem was resolved.
STAY WITH WHAT YOU HAVE …. FIOS SUCKS!!
We had FIOS installed last week. The first problem I noticed was more mislabeled shows than we had with Comcast. You know, where the guide tells you what is on a channel, but it’s really another show. So the result is if you want to record a series (several episodes of the same name) many of them are not the show at all, even though the machine records it as such.
The second problem we have been unable to troubleshoot. Our two year old XP will not connect with the internet above snails pace even though the connection is strong. It never had a problem with dial up. We have spent several sessions on the phone with the tech crew pinging, and restarting, and trying various options, we even installed an new wireless card to no avail. The company sent out a second box, we tried that. Still super slooooooowwwwwww. Any ideas?
I think those who are posting problems with FioS are Comcast etc customers who are jealous FioS isnt avail in their area. Or Cable fanbois. FioS KILLS Cable, and that is a fact you will all have to live with. Cable can not and will not catch up. I am on a 50/15 line (for business use) and it is amazing. Comcast is in trouble and I cant say I am ready to shed a tear for them.
I use FiOS and it is infinitely faster and more reliable than my neighbor Road Runner digital cable. I don’t know if Verizon is making money after all of their expenses in getting this going, but they someday will own the highway that we all use to stay connected. The only true competition they have is broadband wireless, but we’re just not there yet.
You clearly needs to do more research, or title your article differently.
When the digital conversion goes through, hopefully sooner than later, a lot of bandwidth will be opened up, giving cable the ability to reach speeds in excess of 150Mbps in the next few years.
A current analog cable channel takes up 6 Mhz worth of space on a line. When the conversion takes over, every channel could be converted to Digital HD, and still only use 3Mhz of space. All they have to do is reappropriate space and FIOS and cable can compete.