Why do you say it doesn’t scale well? It’s building the underlying structure necessary to go to an all fiber network eventually without paying a premium?
Verizon is having to pay so much for FiOS that even with the good uptake they’re still having to roll the service out extremely slow. They’ve been rolling it out for 3.5 years now and they’re probbaly not going to finish it for quite a while longer. I guarantee you that if Verizon serviced you, you’d definitely not see it. As is they’re trying to sell off 3 rural states to accomplish it.
That's what AT&T should do - downsize to a level where it can afford to upgrade the network to modern standards.
Those spun-off Verizon states will fare better too. They won't get fibre right away, but they'll get better upgrades than AT&T's rurals will.
Having seen what Verizon had to do to roll out FIOS in my neighborhood, I can say it’s quite an undertaking, and can understand the costs involved.
As well, I think that the time to take to roll it out isn’t only a matter of costs, but also a matter of availability of workers to do the roll-out. That's part of the difference between rolling out infrastructure in urbanized settings and in rural settings - it takes more workers and more time.
Nonetheless, we’ve had FIOS for over a year now (I was the first person in my neighborhood to sign up for it) in my semi-rural neighborhood out in the sticks of Anne Arundel County, MD. For $100 per month (plus taxes), I get phone service with unlimited local and long-distance calling, basic television (local channels), and 15Mbps/down 2Mbps/up Internet. It works very, very nicely.
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