Verizon’s FiOS vs. DSL: Battle of the Brands
Written by Matt Wainwright (contact - e-mail) -- September 20th, 2007 |
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Competitive positioning is a tricky matter in any business. Companies work hard to educate and train consumers about their product. Sometimes they do such a good job at it that they have trouble educating their customers about anything new. Verizon carved-out a nice spot as a low-cost player in the broadband market with its DSL service undercutting cable providers on price. Now, Verizon wants to go premium with a fiber optic service it calls FiOS. Unlike common coaxial cables, fiber-optic cables are not subject to electromagnetic interference and can transmit more data, faster and farther. While this presents a high performance alternative to cable, it’s not clear that prospects are getting the message.
In July, 8 million unique visitors (UVs) went to verizon.com. 25% of them clicked-through to broadband FiOS and/or DSL-related pages. A healthy 88% of UVs visiting these pages did not exhibit customer-related behavior, and looked more like prospects rather than existing Verizon customers. Many of them actually subscribed to competitors, like Cox, Comcast, Qwest or RCN. While Comcast subscribers were the overwhelming majority of this last group, they represented less than 3% of Comcast’s massive subscriber base overall. Meanwhile, at least 16% of RCN subscribers visited Verizon’s broadband pages, and virtually all of those UVs were interested in FiOS.
But this interest in FiOS was the exception to the rule:
• In July, Verizon’s DSL-related pages saw 150% more UVs than all its FiOS-related pages together. Remove Verizon subscribers (who probably already have DSL) and that figure jumps to 250%.
• Qwest subscribers appear the least interested with only 1 in 6 viewing any FiOS pages.
With FiOS being a substantively better product (technically speaking) than cable, Verizon should have the opportunity to compete as a premium player in the broadband market. Strong branding is a good first step. Prospects currently view FiOS as Verizon’s “DSL upgrade” and as comparable to cable, but they need to view FiOS as having leapfrogged cable into the high-end of the marketplace. 54% of visitors who entered “fios” into a search-engine clicked through to verizon.com and affiliated sites. As a next step, Verizon may want to decrease, or continue decreasing, its DSL marketing efforts… and begin retraining consumers (especially the competition’s customers) that FiOS is what they really want.
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September 20th, 2007 at 9:00 pm
Until Verizon picks up the pace on the FioS rollout, none of these different marketing options really matter. I live in Richmond, VA which was one of Verizon’s test markets for Fios. I am in an area with high population density and significant growth, yet i still can’t get the product. I am one of the Comcast subscribers who have clicked through to the FioS content, several times over the last year. I’m tired of waiting!
September 21st, 2007 at 3:09 pm
Same here in NH…Verizon quit rolling it out about two towns over from me. But they’re selling their internet business to some company that is hellbent on bringing DSL (i could give a crap) to podunk towns way up in the sticks… And i’m stuck with Comcast…while a good service, the prices are not really worth it.
I’ve been to the Verizon FIOS site many times…looking for availability.
September 23rd, 2007 at 11:08 pm
I’ve switched to FIOS from Cable Vision, and wow the reliability is much better, and the speeds are much faster, and Cable Vision use to be the best internet cable provider in my area!
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September 15th, 2009 at 7:50 am
Can you guys make a a real comment…anyway I don’t it’s a brand competition but what you could actually offer…FiOS is Fiber Optic…others are just what…so it’s really a competition of the kind of service you could provide at a reasonable price…in my opinion…