The fiber speed wars have started heating up again as providers eye ways to differentiate themselves with double-digit multi-gigabit speeds and once again Ziply Fiber seems to be leading the charge toward even faster fiber offerings just as cable’s DOCSIS 4.0 technology starts to take off.
Impact: Just as Ziply Fiber made waves in January 2022 when it launched 2 Gbps and 5 Gbps service barely a week ahead of AT&T’s launch of the same speeds, this week the regional provider dropped another bombshell with the launch of a new 50 Gbps tier a week after Google Fiber said it planned to roll out 20 Gbps service by the end of the year using 25G-PON technology from Nokia. The move builds on Ziply’s 10 Gbps launch earlier this year, which used Ethernet technology to deliver symmetrical double-digit speeds. Ziply will stick to that strategy again with 50 Gbps (and any other higher tier launches) until advances in PON technology catch up. CEO Harold Zeitz commented when speaking about the launch that Ziply could offer 400 Gbps service if it wanted based on the way it has set up its network architecture, which can support either a PON network to the home or the type of direct fiber connection offered by Ethernet. But Zeitz acknowledges that nobody will get 50 Gbps service over Wi-Fi right now, as the technology just isn’t there yet.
Customers in Ziply’s four-state Pacific Northwest footprint interested in the 50 Gbps service should be prepared to shell out big bucks, however, as Ziply has priced it at $900/mo. And that’s just the monthly rack rate; customers will also have to pay a $600 one-time installation fee for Ziply to run fiber to their home and a fiber optic-receiver (a compatible QSFP28, per LightReading). But customers will have to buy their own router, because while Ziply offers routers for customers to purchase with its other fiber tiers, it’s not doing so this time. That means customers must find and foot the bill for a router that can support 50 Gbps service while also paying for any in-home wiring upgrades that might be needed to support the tier. Oh, and the router Ziply recommends retails for $2,200. But while Ziply claims it expects demand for the speed, the launch really appears to be about positioning itself for the future when more customers will demand these types of speeds. Zeitz predicts demand for the faster speed even with the high cost, although he expects to only capture only a few early adopters to start, adding a small number of new subscribers each month. He bases that prediction on internal company data that shows 15% of new subscribers every month choose a multi-gigabit tier. Whether they start selecting an even faster multi-gigabit tier remains to be seen.
Unlike Google Fiber, which hasn’t revealed where it plans to launch 20 Gbps service and which plans to use an invitation-only approach with the tier at first, Ziply offers 50 Gbps across its fiber footprint already. Google Fiber also hasn’t revealed a price for the new tier but considering its other gigabit and multi-gigabit price points, which includes $70/mo for gigabit service, $100/mo for asymmetrical 2 Gbps, $125/mo for 5 Gbps, and $150/mo for 8 Gbps, we would expect affordability to be part of the package. Google Fiber head of product Nick Saporito, who wrote the blog post announcing the 20 Gbps strategy, indicated the company will eventually roll the new tier out to “most, if not all, of our markets.” Amidst the speed explosion, Ziply continues to upgrade its footprint from legacy copper to fiber and eventually plans to reach a million or more locations with fiber, approximately 80%-85% of the legacy copper footprint it acquired from Frontier in 2020. Zeitz said the company should have 60% of those locations connected to fiber by the end of the year. Ziply also has edge-out fiber projects underway in four Washington communities adjacent to its existing footprint: Grandview, Union Gap, Walla Walla, and Yakima. It also plans to pursue government broadband subsidies where feasible, including through the upcoming BEAD program despite Zeitz’s concerns about the guidelines governing the funding, to cover as much as 15% of its footprint where it would otherwise cost too much to deploy fiber.
Prior to the Ziply announcement, Knoxville, TN, provider EPB sat at the top of the fiber speed heap with a 25 Gbps offering it sells for $1,500/mo. Although the two don’t compete with each other, the $900 price tag for Ziply’s 50 Gbps service appears more reasonable when measured against the EPB pricing for a lesser speed. Now that Google Fiber has indicated its near-
term plans to reach 20 Gbps and Ziply’s jump to 50 Gbps, it’s a safe bet more double-digit tiers will launch through the end of this year and into early 2024 as providers work to keep pace with each other and gauge consumer demand for such high-
level speeds. AT&T, for instance, said a year ago that it could be ready to launch a 20 Gbps offering either very late in 2023 or sometime in 2024, but it hasn’t publicly mentioned its plans for faster multi-gigabit speeds publicly since then. Chances are providers will keep their plans under wraps until they’re ready to try to get a jump on the competition.