Investors warm to FiOS

Fiber is cheap, gear is getting cheaper, and wiring the entire county with it seems less and less an absurd idea. When Ivan Seidenberg came out with his grand scheme to create a fiber network a few years ago, he was met with incredulity. In 2003, he was talking about dropping from  $20 billion to $40 billion into the project over 10 to 15 years. Verizon had money to burn, but nothing on that scale. Investors in the instant-gratification age are cool to capex beyond the bare minimum, but with some justification. Chief executives often have no idea what they're doing, having reached an ego stage of believing the mere pronouncement of something makes it so.

Not so with Seidenberg, who started in the business stringing telephone lines. Fiber was a big bet, for sure, but one that skips a few generations of band-aid technologies for increasing data rates. Video can be compressed only so much before it looks like stop-action animation, especially on pricey large screen HDTVs. Verizon is signing up around 2,000 FiOS TV subscribers per day.

Turns out investors are coming around to Seidenberg's way of thinking. BusinessWeek reports Verizon's stock is up 18 percent over the past six months, more than double the Standard & Poor's 500 and of that other giant phone company, AT&T.

So there you have it. Fiber is good for you.

For More:
- The article in BusinessWeek is here

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