On FiOS growth and Verizon strategies…

Verizon reported earnings that were higher than expected, but not a blow-out. The most interesting numbers released were for FiOS, which added over 200,000 customers in the quarter and is now approaching the three-quarters-of-a-million mark. And, like AT&T did earlier, Verizon is showing off some strategies that it hopes will expand not only its FiOS offering but also transform its revenue model overall. In fact, we think Verizon’s stuff might be more interesting in this latter zone than AT&T’s was. An example is Verizon’s desire to broaden text messaging from the mobile SMS framework of today to a user-centric and virtually universal service, blurring the boundaries between instant messaging and SMS forever and presumably increasing the appetite for both. The strategy would be smart because of points made in earlier entries here; mobile data services in general have not taken off in many markets except in the youth sector. Since IM is popular with business users, Verizon hopes that creating “IM FMC” it can broaden the use of mobile services for things other than voice. Verizon has a similar strategy in gaming, where it plans to have a hosted game set that can be played at home, from a laptop portably, or from a mobile device. Finally, Verizon plans to introduce much more proactive home network management, for the user themselves through automatic discovery and linking of compatible devices and for the operator through TR-069 to provide delivery management for high-value services. Verizon’s spend per FiOS customer is in excess of $800, and so the company is eager to find new ways to create revenue from those users.