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Verizon (VZ) FiOS And The Corning's (GLW) Miracle Fiber

GigaOm pointed out yesterday that Verizon (VZ) now has about 1.1 million FiOS fiber-to-the-home customers being delivered voice, broadband and TV. The telecom is adding 2,600 customers a day.

For those in the media and on Wall St. who believed that FiOS would be a $23 billion train wreck, the early signs are that the system may do well.

But, fiber has had a big drawback and that is raising Verizon’s installation costs considerably. As Barron’s points out: "Existing fiber cable can’t be bent without significant loss of signal, requiring expensive corner-turning devices." But, Corning (GLW) seems to have solved that problem. In the near future, it is bringing fiber that bends without signal problems to market.

The product should cut some of Verizon’s costs for installing FiOS in seven million homes, which is its goal. It should also help the revenue picture for Corning’s telecom business.

Better earnings, lower costs.

Douglas A. McIntyre

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