[quote]The slow death of DSL will cause the rapid rise of expensive broadband for underserved areas if Verizonâ€™s Fusion home broadband service is any indication. Verizon on Tuesday launched its long-planned home broadband service powered by its LTE wireless network â€” trading slow in-ground copper for expensive airwaves on its end. And the consumer? They trade unlimited slow broadband from a wire for faster service thatâ€™s going to cost a pretty penny.
So what is this wireless panacea?
Verizonâ€™s HomeFusion Broadband uses Verizonâ€™s LTE network to offer homes broadband speeds of 5-12 Mbps for downloading and 2-5 MBps for uploading. For most users, this will be better than the older DSL speeds, which are about 6 Mbps close to the node but slow as you travel further away from the telcoâ€™s central office. Verizon will pop a small a cylinder packed with antennas on the side of your house in order to deliver the service, which comes with the same caps and pricing plans Verizon currently offers its cellular customers. And thatâ€™s really the rub.
All of the plans are usage-based, which changes the broadband paradigm from one of limited bits to limited bytes. Verizonâ€™s plans begin at $59.99 of monthly access for 10 GB of data, and there is a $200 installation charge. If you consider that an hour of watching Netflix consumes about 1 gigabyte, youâ€™re looking at about 8-10 hours of TV a month.
To be fair, Verizon says it is marketing this as an alternative for consumers in broadband-limited markets, where DSL or satellite might be the only options. In the case of satellite broadband, consumers also have caps and limited plans that cost a lot, so this compares somewhat favorably to those. But so far, HomeFusion Broadband will be available beginning later this month in Birmingham, Ala., Dallas and Nashville, Tenn., which are not exactly satellite country. Additional markets will follow.
So whatâ€™s this about the death of DSL?
Verizon may have started out as a collection of wireline telephone companies, but it has been rapidly abandoning its legacy copper by selling off its DSL businesses to Frontier Communications, Fairpoint and even the Carlyle Group. The plan, as we said back then, was to get rid of high-cost copper lines and come in later with wireless broadband that delivered better speeds. From an economics perspective, Verizon spent between $19 billion and $22 billion laying fiber to 16.5 million homes in the last few years. But it has invested a total of $22.3 billion billion in the last three years building its wireless network, which covers more than 285 million customers (all of that is not LTE spending and coverage). And those customers are likely to pay more per month and get less in terms of the data they transmit over the network.
AT&T seems to be learning from Verizonâ€™s tactics. It recently hinted that it would sell its unimproved DSL lines (â€œunimprovedâ€