Verizon sees FiOS profitable in 2009

US operator Verizon expects its fibre-to-the-home service FiOS to post its first operating profit in 2009, about five years after starting work on the project. The company expects to book a return on all its FiOS investments, excluding associated interest, tax, depreciation and amortisation by 2008. The profitability estimates are based on attracting 7 million FiOS internet customers and 4 million FiOS TV customers by the end of 2010. Verizon had around 500,000 internet customers at the end of the second quarter and this is expected to reach 750,000 by the end of this year. The FiOS TV service is expected to reach 175,000 subscribers by the end of 2006.

Verizon said its on track for the FiOS network to pass 6 million homes by the end of this year, rising to 18 million by 2010, or 50 percent of Verizon's wireline footprint. The company is investing in total USD 18 billion in the period 2004-10 in the fibre network, a figure net of the estimated USD 4.9 billion it would have cost to maintain the copper network during that period. The company expects by 2010 a penetration of 20-25 percent for TV and 30-35 percent for internet services among homes passed by the network."