Fiber to the Home Revs Up Expansion, More than Two Million Homes Now Connected to Next Generation Broadband

New study shows rate of growth heading up, “take rate” again on the rise

October 3, 2007 - Orlando, FL – The number of North American households with direct connections into high-speed fiber networks has surpassed the two million mark, according to a study released today by the Fiber-to-the-Home (FTTH) Council and the Telecommunications Industry Association (TIA). The survey also shows that the rate of growth in fiber to the home connections continues to increase as more Americans look to next-generation networks for faster internet and more robust video services.

According to the study, released during the FTTH Council’s 2007 Conference & Expo in Orlando, 2.14 million homes – or nearly 2 percent of the households on the continent – are now connected to the internet via end-to-end fiber. This compares to 1.01 million connections as of September 2006, meaning that the annual growth rate has increased to 112 percent from the 99 percent that was measured last March. The study also shows fiber to the home networks now passing 9.55 million North American homes, up from 6.1 million a year ago.

The study noted that the number of households that receive video services over their FTTH connections has increased sharply over the past six months, to 1.05 million, for an annual growth rate of about 160 percent.

“Clearly, American consumers want what only fiber can deliver – and that is a pipe big enough to handle the high-bandwidth internet and video applications of the future,” said Joe Savage, President of the FTTH Council.

Further, the “take rate” for fiber to the home services – that is, the percentage of households that are offered the service and which actually subscribe – is firmly on the rise. While overall FTTH take rates had been suppressed while Verizon was building its FTTH infrastructure faster than it was adding customers, the company is connecting customers more quickly now. Accordingly, FTTH industry’s overall take rate rose from 22.3 percent to 26.8 percent in the most recent six-month period. The take rate among non-Verizon FTTH providers is nearly 52% and some individual projects have take rates well above this.

While Verizon continues to lead the FTTH market with about two-thirds of total installations, Savage noted that 369 other service providers are keeping pace and maintaining about a third of the overall market.

“We’re continuing to see small and medium-sized telephone companies, cable television companies, municipalities and public electric utilities get into the FTTH game and be highly successful at it,” said Savage.

Michael Render of RVA Market Research (www.rvallc.com), author of the study, predicted further acceleration of FTTH growth within a couple of years from now. “While annual growth in the number of connections has doubled for the past two years, we expect to see a further increase in the growth rate as more as more high-bandwidth applications come to market and as more major service providers begin offering fiber to the home,” he said.

“Next generation broadband deployment is the key to our nation’s technological success in the new century,” said TIA President Grant Seiffert. “The more choice consumers have – whether in providers, hardware, or content – the better off the American market will be.”

Both organizations continue to urge legislators and regulators to adopt a 100 Megabit Nation policy and reduce barriers to next-generation broadband deployment.

About the Fiber-to-the-Home Council – Now in its seventh year, the Fiber-to-the-Home Council is a non-profit organization established to help its members plan, market, implement and manage FTTH solutions. Council membership includes municipalities, utilities, developers, and traditional and non-traditional service providers, creating a cohesive group to share knowledge and build industry consensus on key issues surrounding fiber to the home. Communities and organizations interested in exploring FTTH options may find information on the FTTH Council web site at www.ftthcouncil.org.

About TIA -- The Telecommunications Industry Association (TIA) is the leading trade association for the information, communications and entertainment technology industry. TIA serves industry suppliers to global markets through its leadership in standards development, domestic and international policy advocacy, and facilitating member business opportunities. TIA represents the communications sector of the Electronic Industries Alliance (EIA). For more information, go to www.tiaonline.org.