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Verizon: FiOS Won't Be as Profitable as Copper
In Part Because They Can't Charge $8 For Call Waiting
"Let's face it, the FiOS cost structure will never be as profitable as the legacy wireline structure," Verizon Chief Financial Officer Fran Shammo stated this week during an analyst meeting. Why? According to Shammo, increased competition for TV services and the high cost of programming are the primary reasons why -- both of which are a product of Verizon's decision to not just upgrade to FTTH -- but to also jump into the TV delivery game. Another reason the future won't be as profitable for Verizon (whether it's fiber or carrier pigeon) is the evolution of voice to "just data" and the death of the landline. Traditional phone was a business where Verizon for years not only enjoyed monopoly status, but also had massive profit margins buoyed by a handfull of services like call waiting or call forwarding -- which cost pennies to provide in the modern era but still incur fees of $8 or more per month. Of course if Verizon were to decide to follow AT&T's lead and impose caps and per byte overages....