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Why FiOS TV Doesn’t Need HD… Yet

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As much love as Verizon has gotten for FiOS, there is occasional disgruntled muttering over Verizon’s lack of aggression in adding HD content to FiOS TV. Why would a service provider who has all the bandwidth capacity of fiber to the home (FTTH) get stingy with HDTV? Industry veteran Matt Stump (previously of Multichannel News, now with OneTrak) has posted a well-thought-out analysis on the subject with three possible theories:

1. Cost – Stump estimates it would cost roughly $22M to retrofit Verizon’s entire build-out (18M homes) with extra QAMs to support a tripling of the company’s HD count to 72 channels. That’s not much compared to the $5B spent yearly by Verizon on FiOS, but it’s not pocket change either.

2. Hassle – Why bother with adding QAMs now when you’re planning to go all-IPTV in the relatively near future?

3. No Need – Verizon has been quite successful with FiOS TV even without tons of HD content.

That last theory seems most compelling to me. Verizon will add more HDTV down the line, but why should it hurry when it has other differentiators to offer, including high data speeds, in-home DVR networking, and personalized, interactive TV features? It’s a bit ironic given Verizon’s fiber investment, but no doubt the operator will continue to find other ways to flex its bandwidth muscle.

15 Responses

  1. Not sure if I agree with you on this one Mari.

    When I switched to FIOS a few months ago, they had a much better HD offering than my local cable co and Directv.

    Now here it is a few months later, and they haven’t added any channels despite every other provider adding them at record numbers.

    I’ll give them a little time because it’s football season, but come Jan if they don’t have the History HD channels, I’ll jump back to Bright house networks.

  2. Very interesting, but I suspect you’re in the minority. It’s such a pain to switch providers that I’d wager most people won’t bother to do it twice. And subscriber additions don’t seem to be slowing, which suggests that people are signing on even without the HD incentive. Guess we’ll see if that lasts.

  3. Mari, Dtv and other providers just passed FIOS for HD content and many people like myself signed onto Verizon for the HD content. Verizon will be making a huge mistake if they sit back and do nothing as the HD explosion continues and Verizon will be known as a non-friendly HD provider to all those newbies getting their HDTVs.

    They jumped ahead from word of mouth and will drop back from word of mouth as well.

    My one year subscription will be ending soon and I am already researching Dtv and Comcast.

    Mark my words, this is going to backfire on them.

  4. [...] Why FiOS TV Doesn’t Need HD Yet: Connected Home 2 Go [...]

  5. There have been hints at an early 2008 expansion of HD channels around the web. I wouldn’t count VZ out of the HD content wars just yet.

  6. I’ve switched providers like 6 times in the past 5 years. It doesn’t bother me, but you’re right I’m in the minority.

    As for IPTV. The only reason I use FIOS over DirecTV is because of my TiVo (D doesn’t do TiVo and the HR20 isn’t a TiVo). If they go IPTV and TiVo isn’t there then it might as well not exist.

    Sure I love HD, but only if I can watch it on my schedule.

  7. Tom- I don’t count VZ out of the HD wars at all. I just think they’ll deliver it when it’s necessary, and not before.

    Ben- We’ve still got some time before VZ goes all IP. And you might find FiOS’s DVR compelling… :)

  8. I’m with everyone else here. After getting an HDTV, content is king. I ditched my beloved ReplayTV because it couldn’t do HD, and I’m ditching Time Warner in my area because they have about 6 HD channels and the 6412 III box they gave me is crap. Uh…no offense. I’m sure the problems are with I-Guide, and not the wonderful firmware Motorola provides. :)
    If I move into a FiOS area in a month, HD is going to be a huge factor with which service provider I go with. DishTV already has like 3x the HD channels of FiOS, and a DVR with a much larger HDD and multi-room viewing for FREE. FiOS charges crazy money for multi-room DVR (which doesn’t downconvert HD content), that has a 160GB drive limit because they have external storage locked out! And what’s all this crap about going to an IPTV model? Don’t they HAVE to support CableCard — didn’t they just barely squeak by on the integration ban? Unless a standard for 3rd party boxes is worked out for IPTV, we’ll be right back in the 1980’s with provider-locked boxes — the whole reason CableCards were invented in the FIRST PLACE!

  9. I hope they don’t sit back in terms of HD content. Seeing direct tv get all those HD channels has made me envious. And the horrible software problems with the “upgraded” IMG and the resulting poor DVR recording, etc has been itching to switch. I guess I will give them a few months to sort it out….

  10. HD was the main reason I switched to FiOS a year and a half ago. Now my other local cable co has more HDs as well as 2 satellite providers. So, am I ready to cancel FiOS and go somewhere else? Yup, but I will also give them time (another couple months) to catch up.

  11. [...] and there’s even a short war of words going on between EngadgetHD and Verizon’s policy blog. I’m still skeptical that Verizon has to get aggressive with its HD offerings immediately, but there is certainly a [...]

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