Credit: Shutterstock photoIn recent times, Verizon Communications Inc.VZ has witnessed declining Ethernet Cable orders, with its business customers choosing to switch to cable operators for the purpose. To tackle this challenge, Verizon is now looking to introduce its 'Titan' Ethernet program. The company intends to price its Ethernet cable offering aggressively to lure wholesale and retail customers and control churn.
Industry Trend
Recently, more and more customers have been switching to cable multi service operators (MSOs) for Ethernet services. Per research carried out by the Vertical Systems Group - a data analytical firm, cables MSOs like Comcast Corp. CMCSA and Time Warner Cable Inc. TWC are giving telecom providers a run for their money in the domestic Ethernet carrier market. Cable MSOs continue to invest in expanding their fiber network to offer efficient network services to their retail and wholesale customers.
Verizon's Approach
At present, Verizon's fiber presence is limited to certain locations. The company looks to check the loss in orders by reducing the prices of its Ethernet services, going ahead. Also, Verizon is looking at other options like wholesale 'Fiber to the Internet' as part of widening its Internet access offerings to its customers. Moreover, with the acquisition of XO Communications' fiber network awaiting completion next year, Verizon will look to deepen its Ethernet penetration in the future, thereby leveraging its Ethernet service offerings.
The Bottom Line
The spotlight is now on the Ethernet market, with both telecom operators and cable MSOs vying for a reasonable share. As the industry gains further accretion, expands scope and makes way for higher Internet speeds, increasing competition will likely induce price compression in the future. At the moment, Verizon's wireless rival AT&T Inc. T currently leads the Ethernet space. Can Verizon's Titan program overcome these odds to make it a prominent player in the Ethernet service market? That is for time to answer!
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
