Verizon Home Broadband Share "In Region" Has Not Moved Much

If Verizon now has seven million fiber access accounts, what does that imply about household penetration rates? It is not so easy to say. For starters, Fios accounts serve small business and larger business accounts, not just homes. 

Verizon homes passed might number 18.6 to 20 million. We must estimate as Verizon never seems to publish a “homes passed” figure. At seven million accounts, Fios would represent 35 percent to 38 percent of homes passed. That seems in line with Verizon’s past reporting, but it is not clear whether business accounts are included in those figures. 

My guess is that business revenue--and therefore the accounts and lines--are reported elsewhere. Given the amount of time Fios has been available, that penetration rate testifies to the amount of competition in the home broadband market, where, by and large, it is cable operators who have 60 percent or higher levels of the installed base, and may have higher market share rates (net new accounts added), at least for most of the past two decades. 

Most other incumbent AT&T executives have speculated that they might ultimately get about half the installed base of accounts. 

Long term, MoffettNathanson sees cable having a 50 percent broadband market share in markets in which they compete with fiber-to-home facilities. That implies a shift of 20 percent of the installed base from current levels: telcos gain 10 points while cable operators lose 10 points of share. 

Not all observers agree with that analysis. S&P Global Market Intelligence, for example, does not expect stepped-up telco FTTH investment to change share statistics very much, in the near term. 

But S&P Global Market Intelligence does believe new competition from mobility suppliers using fixed wireless (T-Mobile, for example) will gain about six percent share of the U.S. residential broadband market with about 7.19 million subscribers. 

It is not yet clear how much of that share gain will be claimed by upstarts in the home broadband market such as T-Mobile, and how much will be gotten by fixed wireless operations conducted by incumbents such as Verizon. 

S&P Global Market Intelligence also estimates there will be about 1.52 million satellite customers by the end of 2021, accounting for just one percent of the installed base of home broadband accounts. 

Many observers expect telcos and independent providers  to gain share. The only issue is how much and how long it takes. Historically, most telcos have found their installed base share tops out at about 40 percent of homes passed.