LAS VEGAS — In a city built on excess, it’s very appropriate that the CEO of one of the nation’s largest carriers took the stage at NXTcomm to preach that same concept.
“‘More’ is what broadband and mobile tech mean to society as we enter the next generation of the digital revolution,” said Denny Strigl, president and CEO of Verizon Communications (NYSE: VZ).
As part of the company’s “more” campaign, Strigl announced a dramatic speed expansion for the FiOS Internet service. He said it will now carry speed of up to 50 megabits per second (Mb/sec) to all homes connected to FiOS.
Strigl also used his time onstage to berate critics of the U.S. broadband industry.
“I want to set the record straight,” Strigl said. “America’s communication market is one of the most dynamic and innovative in the world today,” he said. “The U.S. leads the world in the metrics that matter most,” he continued, noting that more than 100 million broadband connections exist in almost every major ZIP code.
He also said that more than half of all households in the U.S. have broadband compared with less than 30 percent for Europe.
Competition is a hallmark of the U.S., where, according to Strigl, 75 percent of U.S. customers have access to at least two broadband choices or more.
“The gold standard for broadband is fiber, which is being deployed faster in the U.S. than anywhere else,” Strigl proclaimed.
He went on to note that the states of Massachusetts and New Jersey have the same population density as Japan and Korea as well as the same broadband penetration.
“It’s time that we put the myth to rest,” Strigl said. “The U.S. communications industry has achieved tremendous things, and unlike most other nations we’ve not done it through industrial policy but through private investment.”
Strigl reported that Verizon has a leading global IP network, and it has been laying high-speed undersea cable between the U.S. and China.
FiOS growth in the home
Meanwhile, Strigl expects Verizon’s FiOS “fiber to the home” business to have 12 million homes connected by the end of the year.
The service is expanding at a rate of 3 million a year, he said, noting that FiOS will be in New York City soon pending city approval, which should come in the next month.
FiOS itself is also getting faster. Strigl explained that Verizon can now send 2.4 gigabits per second (Gb/sec) of download capacity to a node that connects 32 homes.
Even if all the homes used FiOS at the same time, each would get 75Mb/sec of capacity for download. On the upload side FiOS provides 1.2Gb/sec per node, so every customer has 37.5Mb/sec of capacity available for upload.
Though the capacity is there now, Verizon has not made 50Mb/sec of download available to all of its users until now.
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He also acknowledged skeptics who say the market doesn’t need 50Mb/sec.
Strigl disagreed. “The appetite for bandwidth shows no signs of slowing down,” he said. “We’ve already had trials of 100Mb/sec to the home, which will come in the not too distant future.”
On wireless
Strigl noted that early on he realized customers wanted to do more than just make phone calls. The spectrum acquired in the recent wireless auction and the acquisition of Alltel will help Verizon continue to grow its network, he said.
In a press conference following his keynote, Strigl responded to a question about Verizon’s position on WiMAX and the Clearwire consortium led by Sprint Nextel (NYSE: S).
“Concern is a word beyond what I feel about WiMAX,” Strigl said. “It’s always important to be aware of what the competition does,” he explained.
“We’ll watch WiMAX and respond accordingly, but I think it’s an issue that becomes bigger two or three years out.”
Strigl also answered questions about whether he had any other purchases planned. “We have no additional acquisitions to announce here today,” he said.
“Verizon is always interest in looking at possibilities, but frankly at this point the fact of the matter is we have our hands full,” Strigl added.
“We’re working hard to complete the Alltel deal by the end of the year, and we’re in a very good spot in our spectrum position,” he said.
The current U.S. economic slowdown also apparently isn’t bothering Strigl too much.
“What’s affecting our business is a very heated competitive environment,” Strigl said. “We do see an impact in delayed decisions being made by financial services vendors, but beyond that I can’t point to the economy as leading to a slowdown in our business.”
