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Market Research Report
FiOS vs. U-verse: Architectural, Marketing and Technical Considerations
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FiOS vs. U-verse: Architectural, Marketing and Technical Considerations published by IGI Consulting, Inc. in August, 2010. This report price starts from US $ 2995.
Abstract
Overview
FiOS and U-verse - It was about engineering. Now it' s about marketing.
The Verizon FiOS/AT&T U-verse story has been an engineering and capital
expenditure story for several years; now it is a marketing story. Verizon has
what is arguably a superior product, at least in terms of bandwidth delivery,
and Verizon has achieved a 3:2 dominance in the market over AT&T. However, in
the last three quarters, AT&T has been outselling FiOS by substantial
(35%-40%) margins. Why is this happening? This report will look in to some of
the marketing differences to seek the answers. It will also explore the many
other differences between theses two services.
On May 29, 2003, the then three largest RBOCs (BellSouth, AT&T, and Verizon)
announced that they had adopted a common set of technical specifications for
the delivery of fiber-to-the-premises (FTTP). In other times, the announcement
of the FTTP RFP (and the subsequent RFP for GPONs) would likely have been
viewed by most with a big yawn - just another technical standardization.
However, in those times, (this was in 2003-05,) this was - and it continues
to be today - the biggest news in the telecommunications world, perhaps the
biggest in years.
In 2010, this story continues to be the biggest thing in telecommunications.
Verizon and AT&T have become, in five short years, major video providers via
FiOS and U-verse. They are now both ranked in the top 10 for U.S. video
providers. Most of the other companies on that list have been in the video
business for decades. We expect that by the end of 2010, Verizon and AT&T will
respectively serve 3.5 million and 3.0 million video customers. Also, they
both rank consistently at the top of customer satisfaction polls covering
video customers.
These two RBOCs serve approximately 80 million of the approximately 150
million access lines (53%) in the U.S., which is the main reason for the
excitement. They also control the largest interexchange carriers and the
largest cellular phone companies. In short, these two companies are the
powerhouses of the telecom world. In a recent year, their capital expenditures
were 76% of the total by major telephone companies, and constituted over 46%
of all capital spent that year by all telecommunications carriers! Clearly,
these companies have the financial power to rule the equipment markets. In
addition to providing a head-to-head comparison between FiOS and U-verse, this
report will focus on providing a complete background on Advanced Access
Architectures (AAAs). It will also consider the progress to date of AAAs (or
in some cases the lack thereof), and possible changes in architecture. For the
first time, we are going to be considering differences in marketing approaches
for the two services, including actual experience in ordering the services.
This report, more than any of our past six reports on the subject, will focus
on the following:
- Direct comparisons (architecture, technology, marketing) between U-verse
and FiOS;
- Differences in marketing approaches;
- Forecasts for the acceptance of AAAs by customers;
- Bandwidth requirements and options for obtaining that bandwidth;
- Costs of alternatives in AAAs;
- Current regulatory issues impacting AAAs, particularly Net Neutrality;
- Impact of AAAs on legacy high-speed access systems (e.g., xDSL.)
Table of Contents
Table of Figures
The Lightwave Network Series of Reports
The Lightwave Network
The Lightwave Series of Reports
- General Reports on the Network
- General Market Reports
- Specific Systems Reports
Introduction
Background
FiOS and U-verse Today - Major Video Providers
Importance
Past IGI Reports on the Subject
This Report
Marketing Approaches of FiOS and U-verse
The Evolution of the Market Structure Today
RBOCs' Multidimensional Competitive Struggle
- Post-merger Competition
- RBOC Purchase of IXCs
- RBOCs vs. Cable Companies
RBOCs Are Becoming Wireless Access Companies
- RBOC Loss of Main Lines
- It' s a Wireless Access Industry!
The Wireless Access Landscape
Forecast for Wireline to Wireless
The Super Competitors
Google Attacks - Google Voice
Marketing FiOS and U-verse
Major Market Issues
- The 2008-2009 Recession Slowed down Capital Spending
- Both FiOS and U-verse have Shown Signs of Slowing Deployment
- Overbuild
- Other Possibilities for Verizon Overbuild
Marketing Approach of FiOS
Marketing Approach of U-verse
Comparison of Ordering Experiences FiOS vs. U-verse
- A Bad FiOS First Experience
- U-verse Order
General Comments on FiOS vs. U-verse from a Utilization Perspective
FiOS and U-verse - Architectures
Architectural Approaches to AAAs
Capital Costs of FiOS and U-verse
Fiber Requirements for Various Advanced Access Architectures
- BellSouth' s Fiber to the Curb (FTTC)
- U-verse - AT&T' s Fiber to the node (FTTN)
- FiOS - Verizon' s FTTP (Fiber to the Premise)
Summary of Fiber Requirements
FiOS and U-verse - Modeling Architectural Differences
- Fiber Required for Each Architecture
- Cost of Fiber Needed for Each Architecture
AT&T' s New Plans for BellSouth - a Hybrid FTTC/FTTN
AAA Costs from Public Statements
AT&T - U-verse
Verizon - FiOS
Summary of Costs
Technologies of FiOS and U-verse
Verizon FiOS Technology
- Delivery Technology
- Video Technology
AT&T U-verse Technology
- Delivery Technology
- Video Technology
Bandwidth Requirements and Capabilities
What are the Bandwidth Requirements?
Calculating Bandwidth Requirements
Drivers of Bandwidth Requirements
Bandwidth Requirement 2013 Scenario
Bandwidth Capabilities and Options
- The Current Options
- FIOS - FTTP Bandwidth Capacity
- U-verse
- Options for the Needed Capabilities
- Pair Bonding
- Reduce the Distance
- Hybrid FTTN - FTTC
- AT&T' s New Plans for BellSouth - a Hybrid FTTC/FTTN
- Compression
- NGPONs - Advanced Options - 10-GPON and WDM-PON
FiOS and U-verse Forecasts - 2010
FiOS and U-verse Forecasts - 2010
Forecasts for Deployment
FiOS vs. U-verse - Deployment Forecast Summary
- AT&T - U-verse
- Verizon - FiOS
FiOS vs. U-verse -Forecast Size of Deployments
- Forecast of Homes Passed
- FiOS vs. U-verse - Penetration Rates
- Growth of FiOS vs. U-verse and Reduction in xDSL
FiOS vs. U-verse - Technology Forecast
- Forecast Technologies by Type
FiOS and U-verse Vendors
Selected Vendors
Vendors of GPONS
Vendors Listing
Detailed Listing of Vendors
- Acterna (acquired by JDSU)
- ADC
- Adtran
- Advanced Fibre Communications Inc. (AFCI) (Now Tellabs)
- Alcatel-Lucent
- Alloptic Inc
- Amino Technologies plc
- AOC Technologies
- Avanex Corporation
- Broadlight
- Calix
- Cisco
- Conexant
- Corrigent
- Entrisphere Inc. (Acquired by Ericsson)
- Ericsson
- Fiberxon (Now Source Photonics combined with Luminent)
- Finisar Corporation
- FlexLight Networks (Defunct)
- Fujitsu
- Genone3 Technologies Inc.
- Hitachi Communication Technologies Ltd.
- Humax USA Inc.
- Iamba Networks
- JDS Uniphase
- Kreatel Communications AB (Acquired by Motorola)
- LG Electronics
- LightComm Technology
- Marconi
- Microsoft
- Motorola
- NeoPhotonics
- Nortel
- Novera Optics (owned by Nortel / LG JV)
- OFS
- O-Net Communications Ltd
- Oplink Communications, Inc.
- Optiviva Inc.
- Optical Solutions (Acquired by Calix)
- Osaki Electric Co. Ltd.
- Paceon (Mitsubishi)
- Passave (Acquired by PMC-Sierra)
- PMC-Sierra
- Quantum Bridge Communications (Acquired by Motorola)
- Salira Optical Network Systems
- Scientific-Atlanta (Cisco)
- Siemens
- Source Photonics (Combined with Fiberxon and Luminent)
- Tandberg Ltd. (Ericsson)
- Tellabs
- Terawave (Acquired by Occam Networks)
- Tut Systems (Acquired by Motorola)
- Vinci Systems, Inc. (Acquired by Tellabs)
Appendix I - IPTV and Approaches to Video Delivery
Broadcast
IPTV
- IPTV Architecture
- IPTV Global Architecture
- Super Hub Office
- Video Hub Office
- Serving Offices
- IPTV Distribution and Access Architecture
- IPTV Channel Selection
Table of Figures
- Figure 1, Lightwave Network
- Figure 2: Summary of Competitive Position
- Figure 3: Revised Competitive Structure Due to IXC Purchases
- Figure 4: RBOCs Subsume IXCs and CLECs
- Figure 5: RBOCs vs. Cable Companies
- Figure 6, Telcos vs. Cable Companies - 2010
- Figure 7, Verizon Wireline vs. Data Revenues
- Figure 8, Verizon Loss of Main Lines vs. Data Revenue
- Figure 9, Wireless Competition
- Figure 10, Forecast for Wireline to Wireless Migration
- Figure 11, The Super Competitors
- Figure 12, Google as a Serious Threat
- Figure 13, Predominant Advanced Access Architectures
- Figure 14, BellSouth FTTC
- Figure 15, AT&T U-verse (FTTN)
- Figure 16, Verizon FiOS (FTTP)
- Figure 17, Fibers Required per Year for Each Architecture
- Figure 18, Amount of Fibers for the Architectures
- Figure 19, Length of Fiber for the Architectures
- Figure 20, Fiber Costs of the Three Architectures
- Figure 21, Fiber Cost per customer - Each Architecture
- Figure 22, AT&T - BellSouth Hybrid FTTC
- Figure 23, Fiber Required Upgrading to Hybrid FTTC
- Figure 24, Annual Costs of AAA
- Figure 25, PON - Central Office Portion
- Figure 26, PON - Outside Plant Portion
- Figure 27, Wavelength Assignments - FiOS
- Figure 28: Bandwidth Needs - Forecast Through 2013
- Figure 29, Drivers of Access Bandwidth Requirements
- Figure 30, Usage Scenario - 2013
- Figure 31, 2013 Bandwidth Requirements
- Figure 32, Forecast Access Bandwidth Requirements 2013
- Figure 33, Comparison of Internet Access Speed Offered
- Figure 34, PONs' Bandwidth Capacity
- Figure 35, VDSL2 Bandwidth vs. Distance
- Figure 36, AT&T - BellSouth Hybrid FTTC
- Figure 37, Fiber Required Upgrading to Hybrid FTTC
- Figure 38: Forecast Homes Passed Cumulative - All Technologies
- Figure 39: Forecast Homes Passed Annually - By Company - All
Technologies
- Figure 40: FTTX vs. High-speed Accesses vs. US Households
- Figure 41, AAA Growth vs. Legacy XDSL
- Figure 42: Technology Type Cumulative - Forecast
- Figure 43: Forecast Technologies - Homes Passed - Annual
- Figure 44: Forecast Homes Passed - PONs vs. Other Technologies
- Figure 45: Verizon PON Forecast
- Figure 46: AT&T PON Forecast
- Figure 47, Originally Selected Vendors
- Figure 48, Newly Selected Vendors
- Figure 49: GPON Selected Vendors
- Figure 50, Summary of Vendors
- Figure 51: Broadcast TV on BPONs
- Figure 52: Broadcast TV
- Figure 53: IPTV General Architecture
- Figure 54: IPTV Global Architecture
- Figure 55: IPTV Access Architecture
- Figure 56: FTTP Architecture for IPTV
- Figure 57: IPTV Hub Office Architecture
- Figure 58: IPTV Channel Selection
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