Verizon adds 134,000 FiOS subs in fourth quarter; 553,000 for year
Verizon (NYSE: VZ) FiOS service numbers continued to grow, especially in a statistic that service providers love to tout: Average Revenue Per User (ARPU). The bundled voice, video and data service reaped $105.63 ARPU in revenue in the fourth quarter, up from $103.86 in the third quarter and $9.20 higher than the fourth quarter of 2011, according to fourth quarter 2012 financial data.
Even better, "for customers who are deciding to upgrade to additional FiOS services, we are seeing a $45 lift in monthly ARPU," said Fran Shammo, Verizon's CFO, during an earnings webcast this morning, citing the carrier's aggressive copper-to-fiber transition.
On the other hand, subscriber additions continued to flatten out, with 134,000 new FiOS subscribers joining the ranks in the fourth quarter compared to the 194,000 who joined in the fourth quarter of 2011. The additions brought the total FiOS video universe to 4.73 million subscribers, an annual increase of 553,000 subscribers.
The numbers weren't bad, said Shammo, who noted that "net adds were greater than the second and third quarters… in spite of the significant disruption caused by the [Superstorm] Sandy restoral efforts."
Part of the reason for the growth, Shammo said, was Verizon's decision to bite the bullet and authorize overtime "so that we did not lose customers by making them wait until we caught up to the backlog."
In all, he said, Verizon is targeting an additional 300,000 homes within its FiOS markets in 2013.
Broadband continued to be a FiOS strength, with 144,000 new subscribers joining the ranks in the fourth quarter (still less than the 201,000 who joined in the fourth quarter of 2011) and the total number swelling to 5.42 million subscribers, compared to 4.82 million in 2011. FiOS broadband, in fact, carried the day for the service provider, as Verizon lost 117,000 non-FiOS high-speed Internet and DSL customers compared to a 27,000 gain in broadband subscribers overall.
On the revenue front, FiOS generated $2.57 million in the fourth quarter, a slight increase over the $2.49 million generated in the third quarter of the year but a nice rise over the $2.22 million in revenue generated in the fourth quarter of 2011.
Overall, FiOS continued to dominate Verizon's wireline business. The carrier reported 8.8 million year-end broadband connections, a 1.2 percent year-over-year increase, and broadband revenues of $3.5 billion "driven by customer purchases of higher speed FiOS services," the carrier reported.
While moderating its growth pattern to remain within its existing footprint, the carrier is "looking to further penetrate the consumer and small enterprise markets," Shammo said.
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