Verizon sets 40 percent penetration goal for FiOS

With its Fiber to the Premises (FTTP) network nearing completion, Verizon's CEO Ivan Seidenberg is turning his company's attention to increasing customer penetration in its existing markets. Obtaining that goal won't be easy as operational issues, including penetrating multi-dwelling units (MDUs) with FTTP, continue to vex the carrier's ability to deploy the service in a timely fashion.

Speaking yesterday at the Citgroup investor conference in San Francisco, Verizon's CEO Ivan Seidenberg said that FiOS is close to becoming operation positive in 2009 with hopes that it will become net positive in 2010. Coupled with those revenue ambitions, the telco wants to reach 40 percent FiOS TV penetration. To meet its 18 million homes passed goal, obtaining a 40 percent penetration rate would be equal to 7.2 million subscribers.

At the end of Q3 09, Verizon had added 198,000 new FiOS Internet customers and 191,000 net new FiOS TV customers, bringing it to a total of 3.3 million total FiOS Internet and 2.7 FiOS TV customers.

One of the issues that is standing in the way of Seidenberg's growth ambitions is the company's ability to penetrate MDUs--a process that's riddled with not only technical but sometimes even political issues.

"We're finding the gravity of getting into a 30-story building and dealing with landlords and cable companies is taking a little longer," Seidenberg said. "The operational complexity has, to some extent, been gating the opportunity for growth in net adds. It's better today than it was years ago, but it should be seamless. It should be done in two days. It should be provisioned over the net."

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