How Long Can the Fiber Boom Last?

With practically every telecom and cable company moving to step up their fiber buildout plans over the next few years, MoffettNathanson senior analyst Craig Moffett wonders if the recent acceleration in construction was indeed too much, and whether telecom and cable companies will be able to justify the cost. There is no question that broadband subscriber growth is slowing down, and that the remedy for both telecom and cable providers appears to be investing more in building out and expanding their fiber reach. It makes sense in that the only way left for most operators to grow broadband is to either expand their footprint to homes that don't currently receive service, and/or boost new home growth. Since providers have no control over the latter, the former has been a big focus. According to Moffett‘s report, over the past 20 years about 30 percent of the US population has been overbuilt by fiber networks. But that coverage is expected to rise to 60 percent in the next five years and possibly 80 percent by 2033, as nearly every telco and cable operator has put forth plans to build new or expand existing networks. Based on announcements of fiber-to-the-home projects, Moffett estimated, telecom companies will add nearly 40 million new fiber passings between 2020 and 2025 for overbuilds alone.