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Verizon Plans All Fiber Rollout Upon Discovering Fiber is Cheaper than Copper

May 20, 2015

Copper theft is an increasing problem in a lot of places, as criminals discover there's some good cash in old fixtures or in various wires often just sitting around a seemingly empty field. But the problem for farmers with irrigation or poorly-policed cities has become an opportunity for Verizon, which took to the stage at the Perspectives15 conference to note its plans to save big money by going to a complete fiber load out.

Though no timeframe was announced for this development, Verizon noted that the potential savings involved were quite clear: fiber is, on average, 60 percent cheaper than copper. It assessed the idea of putting in fiber instead of copper on seven of its central offices, and discovered the savings were so substantial that it was worth the effort to put in fiber in the rest of the 2,000 central offices.

Interestingly, it wasn't just savings in the material that gave Verizon sufficient incentive to plan the change. For instance, real estate cost savings were massive, measuring between 60 and 80 percent with fiber over copper; as it turns out, a copper exchange requires a 13-floor installation, but a fiber-to-the-premises operation needs only two floors. Energy savings measured around half as well, with 40 to 60 percent average savings on hand. Even better, reliability was on the rise as well; fiber is 70 to 90 percent more reliable than copper, meaning that fewer trucks need to roll during outages, and maintenance savings also rise to 40 to 60 percent.

Image via Shutterstock

Even more compelling are the long-term potential benefits of moving to a fiber infrastructure; copper revenue is said to be falling off between eight and 10 percent annually, while copper remains a fixed cost with some occasional rises. That means eventually copper will no longer be a profitable field, or the profit will be insufficient to bother with. Worse, the public switched telephone network (PSTN) is currently a $100 billion annual industry in the United State, but right now, it costs $63 billion just to supply enough electricity to run it.

While Verizon is in the early stages of revamping the network, there's one elephant in the room that wasn't discussed during the proceedings: Google Fiber. Google Fiber has a way of destabilizing markets everywhere it goes, with a combination of impressive service in the paid tiers, reasonable service in the unpaid tiers, and no bandwidth caps in either at last report. With Google Fiber hotly anticipated, it's not out of line to think that competitors may want in on this action, and with so many customers eager to plunk down $70 a month for gigabit fiber access, why wouldn't Verizon want to swap out its copper in exchange for fiber, especially when the issue of savings is added in?

This is a great opportunity for Verizon to take some business out of Google's hands, and an opportunity for every other provider to do likewise. A fiber future isn't just about more bandwidth, it's also about lower operating costs. That kind of win-win situation is hard to pass up, and hopefully, Verizon won't be alone in that realization. 

Edited by Dominick Sorrentino

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