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High-Speed Internet Is Only the Beginning for Fiber Broadband Providers

As the workforce continues to recover from the pandemic, many businesses have called employees back into the office. However, that doesn’t mean their home offices are disappearing. On the contrary – home offices are popping up at a frenetic pace. The rise of hybrid and remote work has created a strong demand for better internet at home. All of the signs for faster internet options like fiber are there, but as an internet service provider (ISP), the competition to capitalize is fierce. Each provider that delivers service is dropping its prices. However, it’s reached a point where it’s a race to the bottom. But what does this all mean?

Today, 1,612 fiber broadband service providers serve businesses and homes across the United States. A vast majority of these providers are smaller, tier-three service providers, equating to 1,200 total providers. They are fighting for 18 percent of the fiber broadband access. Over the next five years, service providers are looking to invest $1.25 billion in new builds, totaling more than the sum of all previous investments. What’s leading to this significant investment in the United States?

The acceptance of hybrid and remote work has led homes to become offices and caused this historic shift. With more than 60 million homes in the United States with access to the FTTH network in 2022, the market is booming and will continue well into the future. However, by only offering high speed and low prices, ISPs are guaranteeing a race to the bottom. Below, we’ll explain which services will elevate the future of ISPs.

Looking to Add Value to Your Network? Add These Services

FTTH is a favorable solution for meeting the unprecedented demand of the future. No one could have predicted the shift to remote and hybrid work would have occurred at this pace, but now that we’re here, it’s critical to understand the importance of what ISPs must offer to keep their client base intact.  

As was mentioned above, high speed and the lowest prices are a race to the bottom. Laying pipe is a major first step to expanding networks, but you’ll cease to exist if that’s all your business does. It must add something of value. Customers don’t want fragmented supply relationships where they go to multiple places for their services, so as an ISP, it’s critical to offer additional and relevant services to have an edge.

Similar to the industry trends of the late 1990s and early 2000s, ISPs must renew their focus on adding services like voice, messaging, and other communication offerings to add value and deliver triple-play and quad-play offerings. Although it’s overlooked, voice is a highly valued service that delivers significant benefits.

Fixed line calling has risen dramatically over the last two years, while calls to and from mobile devices have fallen. Despite the workforce becoming more mobile, the meager quality of mobile networks has caused home workers to revert to landlines. Why? They’re looking to improve call quality and overall experience. Many people have ditched city life and moved to rural areas with the rise of remote work. Unfortunately, mobile devices cannot deliver consistency, meaning alternative options like fiber are necessary.

Fiber ISPs offering voice services can also deliver the recurring revenue and stickiness FTTH needs, providing them with a major opportunity to re-imagine voice for the consumers by layering unified communications in addition to other fiber assets. They can also curate a suite of services that drive margin and revenue growth, differentiates service offerings, and put a cap on customer churn.

Why have FTTH providers overlooked voice services? The main reason has been a singular focus on deploying a network with funding linked to the number of homes passed by the fiber provider or the number of homes sold to. In that same breath, voice has been viewed as complicated to deploy. It’s something that takes too long for services to get up and running. 

With unified communications platforms, a suite of voice services can be rolled out rapidly with expert support that assists FTTH providers with capturing new revenue and implementing it as a growth driver. Unified communications can help ISPs re-imagine voice services and help residential customers with the ability to take their home line on their mobile phone with visual voicemail. Call screening can also help FTTH customers screen calls for vulnerable family members. 

ISPs Need to Adopt Unified Communications

When it comes to unified communications, phone systems, instant messaging, SMS, screen sharing, and more can be controlled through a single user interface that’s accessible across all devices. It enables individuals to reach the most suitable device. Interest in Unified Communications as a Service (UCaaS) was growing prior to the pandemic. However, it spiked 86 percent at the height of the crisis, according to a 2020 report from Avant. The market continues to grow at an unprecedented rate. 

The global UC market will hit $365.2 billion by 2030 with a CAGR of 21.25 per cent. Governments globally are working hard to develop unified communications platforms throughout various industries. For ISPs, adopting unified communications is a significant opportunity in addition to their high speed and low costs. Remote and hybrid work is here to stay, and FTTH is a vital component in supporting these home offices, which will continue to increase into the future.

Remote and hybrid work continues to grow in popularity. According to data from The United States Census Bureau, the number of people who worked from home between 2019 and 2021 tripled from 5.7 percent, roughly nine million people, to 17.9 percent, 27.6 million people. These figures continue to increase dramatically as the world becomes more mobile. The writing is on the wall. If ISPs want to remain relevant, adopting unified communications in addition to their high-speed services and low prices should be at the forefront of their endeavors. 

VoIP Continues to Grow

Double-play and triple-play services offer a simplified billing plan for subscribers. As remote work grows, many people are willing to invest in services that successfully enable them to work from home. Between 2020 and 2021, the number of landline services delivered over broadband nearly doubled. Consumers are seeking unique ways to reduce the number of bills they have by receiving broadband and phone services from the same provider. High-performance broadband at home, in addition to reliable landline services, leaves a wide-open opportunity for ISPs to offer voice services. 

With VoIP, ISPs can “land and expand” their services, starting with voice. Still, additional UC services like mobile forwarding, visual voicemail, call screening, or voice-to-text enable the office experience from home. The global VoIP services market is expected to surpass $278.53 billion, with a CAGR of 11.9 per cent by the end of 2031. For perspective, the market was valued at $82.71 billion in 2020. The rise in the adoption of residential and business lines across a broad range of end-users has translated into exceptional revenue-generating opportunities for ISPs moving forward.

The rising expansion of the telecommunications sector globally has led to a significant demand for voice services across both developed and developing nations. Many major small-to-medium-sized businesses from various industries are adopting VoIP services in an attempt to decrease communication-related costs. With VoIP, you can bypass expensive international roaming charges. As work becomes more global, that’s a significant savings in and of itself. 

The Future of Fiber

The door between the office and home office has been kicked wide open, and the statistics don’t lie when they say unified communications are the future. ISPs can capitalize on the modern global business sphere by offering more services that support communication systems to operate networks. Fiber technology will play a significant role in this growth moving forward. As more and more businesses adopt unified communications and offer remote positions and more people need internet from home, FTTH will continue its growth to support this new era of workers. 

However, competition will swallow up ISPs reluctant to offer voice services that support home offices with critical voice services. Margins will always depreciate with competition, but as long as you remain innovative by offering new services, you have the opportunity to grab the home office and make your way into tens of millions of homes. Want to learn how FTTH can add value to unified communications? Download our white paper, Adding Value in FTTH with Unified Communications, here.