Google Fiber may have lit the FTTH fire, but network construction company Dycom said that AT&T and CenturyLink’s ambitious FTTH expansion plans represent the consumer and business customer’s demand for higher speed bandwidth.
Steven Nielsen, CEO of Dycom, told investors during this week’s DA Davidson 15th Annual Engineering & Construction Conference that AT&T and CenturyLink’s FTTH aren’t directly linked to Google Fiber’s actions.
“Google Fiber is responding to the same factors for consumer demand for high bandwidth that the incumbents are,” Nielsen said. “They are the effect of the consumer demand and not the cause of other people spending because they are all reacting to the same environment.”
Nielsen added how a number of Canada’s key incumbent telcos and cable operators – a list that includes Bell, Telus, Shaw and Rogers – all stated they will enhance their fiber and broadband footprints.
“In Canada where Google Fiber is not present, you have the exact same dynamic as you have here in the U.S.,” Nielsen said.
AT&T and CenturyLink have set some ambitious targets for their FTTH deployments, a process that will represent potential new revenue streams for Dycom. During the second quarter, AT&T had only 2.2 million homes passed with fiber, a figure the telco expects to ramp to 2.6 million by the end of 2016.
In order to meet its FCC commitment, AT&T will need to build fiber to an additional 9.9 million homes by 2019, illustrating an acceleration in its overall network investment.
CenturyLink expects to reach 11 million premises at 40 Mbps or higher, including 2 million GPON-enabled addressable households and businesses, by year-end 2017.
At the end of end of 2018, CenturyLink expects to have 10.5 million, or over 85 percent, of addressable broadband-enabled units at 40 Mbps or higher speeds in its top 25 markets. Within that time frame, the telco said it will have 7 million, or over 55 percent of addressable broadband-enabled units at 100 Mbps or higher.
Looking toward 2019, CenturyLink forecasts that 11 million of its addressable broadband-enabled units will be able to access 100 Mbps or higher speeds. Additionally, it expects that 3 million addressable broadband-enabled premises will be equipped with 1 Gbps or higher speeds over its FTTH network.
Dycom estimated that in the United States, there are currently 125 million homes, with each home passed by two separate providers, representing a total of 250 million total potential homes passed.
Out of this group, 75 percent of those homes will likely be commercially viable for fiber deployment, representing 188 million potential homes that could be passed with fiber. As of the end of 2015, the U.S. only had 26 million homes passed by fiber, or only 14 percent of the total addressable market.
“When people try to size up the opportunity and the longevity of the opportunity, we think it’s big and we’re in the early stages of deployment,” Nielsen said.
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