Subscriber gains drive FiOS revenues up 15.1 percent in first quarter

The addition of 169,000 FiOS video subscribers--and 188,000 total broadband subscribers--drove Verizon wireline revenues up 15.1 percent year-over-year to $2.6 billion. The subscriber gains easily topped fourth quarter numbers where Verizon gained 134,000 new FiOS subscribers.

Verizon Q1 2013 slides

Click here for selected slides from Verizon's investor presentation.

The carrier credited FiOS gains for driving consumer wireline revenues across the board and now accounting for 69 percent of all wireline consumer revenue. Overall wireline ARPU was up 9.5 percent to $107 a month and FiOS ARPU came in at $150 per month. Two-thirds of FiOS consumer customers buy a triple play package, the company added.

FiOS isn't expanding outside of its existing markets, and hasn't been for some time, so the company is taking steps to improve infrastructure in the markets where it's offered.

"This network evolution initiative is important for us as we systematically reduce our dependence on older technologies throughout the business," Francis Shammo, executive vice president and CFO said during an earnings call with analysts. "We did have a very, very good process this quarter in converting these migrations."

That progress included converting 83,000 homes from copper to fiber in the first quarter and pushing forward with a goal of 300,000 conversions by year-end.

The migration, Shammo emphasized, "is really a technology change. We need to really move to the new technologies. We need to encourage our customers and others to move to the new technologies in order to provide our customers with the best solutions that they have and for many of our customers, that service is best delivered over fiber or even maybe on a wireless network."

Even with FiOS success and infrastructure revamping, Verizon remained committed to partnering with cable operators to offer Verizon Wireless as a quad play component for cable operators--in non-FiOS markets--and to market cable services to Verizon customers.

"Obviously we believe that the quad play is important," Shammo answered an analyst's question. "That's why we entered into the cable agreement that we did a year ago with the cross-selling agreements and also with the joint innovation that we have agreed to do."

Overall, FiOS--and wireline in general--took a back seat to the wireless business during the earnings call, even though Shammo concluded that the company is "on a good path here to continue to produce solid wireline consumer revenue growth."

For more:
- Verizon issued this earnings press release
- and Morningstar has this transcript of the earnings call

Earnings summary: Wireline telecom earnings in the first quarter of 2013

Related articles:
Verizon adds 134,000 FiOS subs in fourth quarter; 553,000 for year
In detail: Verizon's Q1 2013 earnings
Verizon FiOS additions drove up consumer revenue 4.3% to $3.6 billion

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