FiOS TV: The Light Fantastic

If you've confused some of the recent TV commercials from Verizon, AT&T and the cable companies with ads from Metamucil, that's to be understood. Both, after all, extol the virtues of fiber. But while the former claims it can help you lead a longer life, the latter promises to make it a happier one. That's because as consumers clamor for an ever-vaster assortment of high-def programs and new interactive services, fiber-optic systems, which send data as pulses of light, have the capacity to deliver it.

Given the recent ads, fiber-optic networks have become talking points for many TV service providers. The reality is that while many cable companies and AT&T employ fiber in parts of their distribution network, Verizon is actually the only one running fiber all the way from the head end to the customers home in all its installations (AT&T's U-verse does run fiber all the way in some new-home construction).

Although the emphasis on fiber is new, the technology isn't; fiber-optic cables have been used since the mid-1990s, when cost-effective lasers, capable of sending signals down long lengths of fiber-optic pipes, were developed and deployed in cable systems. But it never really seemed sexy enough to talk about until Verizon launched its FiOS TV and Internet service in 2005, making it the relative new kid on the TV service block. But TV has long been on the company's radar; in fact, Verizon conducted a test-run of a copper-based TV service in Tom's River, New Jersey, back in 1993.

Given its come-from-behind status in the TV service race, it's not surprising that Verizon has been aggressively promoting and rolling out its fiber-optic FiOS services. At times slow going due to the market-by-market franchise approval process, FiOS TV has been helped by several states passing statewide franchising legislation. By the time you're reading this, the company should have close to 1.5 million FiOS TV subscribers, having passed the 1-million subscriber mark back in January and adding about a quarter-million new takers per quarter. By comparison, AT&T had 230,000-plus U-verse subscribers at the end of 2007, and it predicts it'll have 1 million subscribers by the end of 2008. Thanks to existing distribution agreements, both companies also resell satellite-TV services in a number of markets, so each company actually has a greater total number of video users.