US telco Qwest Communications will invest an extra $300 million in capital to build fibre-to-the-node networks (FTTN) to reach 1.5 million homes in 20 markets but is not planning to deliver IPTV service over those networks. Qwest Chairman and CEO Ed Mueller also promised more details about Qwest's plans in late February of 2008 when it hosts an analysts' day.
“Our FTTN network is not intended to deploy of IPTV,” Mueller said. “We do not believe the scale and current capital and labour requirements of this type of product support this approach.”
Instead, Qwest will continue to resell DirecTV satellite video service while pushing to offer high-speed data at speeds up to 20 Mb/s, Mueller said, drawing on the experience Qwest gained from building FTTN networks in Denver and Colorado Springs. Based on that experience, Qwest would expect to double the penetration of higher speed Internet service and its ARPU, Mueller said.
Mueller said other applications, such as gaming, would generate other revenues. Qwest is targeting homes within its largest 10 markets and 10 other markets that it believes can most quickly generate a return, Mueller said, instead of blanketing the markets. Investment in '09 will depend on how the 2008 work goes, he said. Qwest will maintain “a disciplined approach” to how it expands its network, Mueller said.