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Top Spot in Communications: FIOS vs. Cable, FIOS vs. Dish

written by: Jermaine S•edited by: Lamar Stonecypher•updated: 5/20/2011

Verizon FIOS is the new player on the block, and it’s making great inroads into a market dominated by Cable and Dish. These days it’s all about competition when it comes to video and Internet services. And lately, there’s been a heated battle going on in contested marketplaces around the country.

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    The FIOS Comparisons

    Contending in the field for the top spot in communications technology are three distinct services, fighting hard to earn their portion of consumer dollars. And while it’s still too early to pick a sure winner, there are distinct differences between the technologies that could leave one standing high above the other two. In light of my previous article, FIOS: What is it? How it Works? I’ll be looking at the battle for supremacy by comparing FIOS to its greatest competing technologies, the cable companies and Dish Network.

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    Round 1: FIOS vs. Cable

    Verizon Cable companies easily dominate when it comes to both video and Internet services. Since the first cable television offering in 1948, the cable companies have been expanding into every reachable market in the United States. They’ve increased service offerings while maintaining consumer friendly price points, and as a result cable has become a top choice for television in every market it’s offered. With nearly $60 billion in yearly earnings, cable television has become a winning industry. Add on the $25 to $30 billion from communications services including telephone and Internet and you have a market that’s hard to resist for newcomers.

    Verizon FIOS, the leader in fiber to the home technology is doing its best to take a large chunk out of cable’s market. Going after the established companies with a simple plan in mind: offer customers more services for less money. More television channels, especially of the high-definition variety, more Video-on-Demand, and faster Internet speeds. All for a price which is lower than comparable deals offered by most local cable offerings. The combination of services and pricings has seen customers flock to FIOS wherever the service has deployed. But the cable companies haven’t been lax in fighting back.

    The big 3 cable companies, Cox , Comcast, and Time Warner have deployed new services to match the FIOS offerings, upgrading their technology to match FIOS top 50Mbps service tier in competing markets, and increasing video-on-demand services. But while they’ve been able to compete successfully in terms of Internet speed, the cable companies have begun placing restrictions on usage, limiting the amounts of data deliverable on their broadband services. They’ve also fallen short of FIOS in television quality, as FIOS offers uncompressed video broadcasts vs. cable’s compressed video, leading to less video artifacts and sound improvements on FIOS’ part.

    While FIOS has the price to service advantage, it’s been greatly limited by availability. The service is currently available in few markets nationally, and for those markets in which it’s chosen to compete, deployment has been slow and costly. FIOS has also run into government resistance, with many municipalities slow to approve the deployment of FIOS in their areas due to existing agreements with cable companies already servicing the area, or due to the disruption that would result from the construction necessary in order for Verizon to lay new lines. But while availability has been limited, in those areas where FIOS has managed to compete, it’s become the fastest growing service, cutting heavily into the cable dominated markets.

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    Round 2: FIOS vs. Dish Network

    Once the leaders in high-definition and total amounts of channel offerings, the Dish Network has been hard hit by competing services. At one time Dish Network was the only viable choice for digital television service, offering a much improved picture over broadcast television or cable. But FIOS offers more channels than Dish Network, including more in high-definition, a greater variety in on-demand services, and matches Dish’s digital only quality. For broadband Internet service, Dish's satellite broadband barely qualifies, offering with its fastest package only 1.5 Mbps download speeds with severe restrictions on total allowable data transfer amounts, in comparison to FIOS’s unrestricted 50Mbps top tier service.

    Although FIOS offers superior service to Dish Network, satellite companies like Dish Network and DirecTV still take in some $20 billion yearly in pay-tv fees. And there’s no comparison when it comes to coverage between the two systems. Dish Network is clearly a winner in availability, with service available wherever the satellite can be seen by line of sight, whereas FIOS still has to deploy throughout much of the country. For rural hard to reach areas, Dish remains the best, if not the only service available for broadband Internet and digital television.

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    FIOS, The Contender

    When comparing FIOS to either cable or Dish Network it’s easy to see why the new service by Verizon has become an effective competitor to those that have established for decades. In the broadband Internet market FIOS offers speed without the data restrictions being widely adopted by cable Internet providers and Dish Network. In the television market, FIOS offers a greater channel listing, improved high-definition, and a larger selection of video-on-demand than the other two services. With higher quality service, and a more competitive price/service range, FIOS would appear to be the clear winner in comparisons, if only it had wider availability. While deployment operations continue at a brisk pace Verizon still has years to go before it can compete head-to-head against the other services in most major marketplaces. Until it can, FIOS remains a top contender for the communications crown, waiting for a chance to put up a good fight for a place as market leader.