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Summary:

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 […]

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.

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  1. 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.

  2. François Schiettecatte Wednesday, August 8, 2007

    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.

  3. Cynthia Brumfield Wednesday, August 8, 2007

    Om,

    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.

    Cynthia

  4. I just upgraded my Comcast to 8 megs down and 768 up for an extra $10. Upload speeds are good, worth the extra money.

  5. 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 :)

  6. 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?

  7. 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.

  8. I can’t wait for FiOS to hit the Bay Area…I will make the move immediately.

    Michael Vu
    CTO/Founder
    http://www.FantasySportsMatrix.com

    …a social network for sports fans.

  9. 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
    http://samgonzales.blogspot.com/2007/07/verizon-fios-sucks.html

  10. Charlie Uniman Wednesday, August 8, 2007

    Anyone have any idea when FIOS will come to New York City; specifically, Manhattan?

    CDU

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