Fiber optic cables cost too much, data center and 5G at risk

Fiber optic cables cost too much, data center and 5G at risk

Fiber optic cables cost too much

The shortage of fiber optic cables threatens to threaten global digital growth. According to the Financial Times, the economic crisis has caused a significant increase in the prices and delivery times of fiber optic cables, compromising the investment plans of several telecommunications companies and threatening global connectivity.

According to the Cru market information company, the most affected areas are Europe, India and China, where fiber prices have increased by 70% since March 2021. This is a serious problem, as fiber optic cables are critical to running data centers - the physical structures that companies use to hold their most important data. Although the pandemic period has generally led companies to reduce their investments, the significant increase in the demand for the internet and digital services has in fact forced several of the tech giants, including Amazon, Google, Microsoft and Meta, to expand their data. center to cope with the greater amount of data that the growing demand forces to manage.

In addition, several European governments have set rather ambitious targets for the rollout of super-fast large bandwidth and 5G, both of which require large amounts of cables fiber optic. Just a few weeks ago Italy awarded the last 5G tenders and the Minister for Innovation Vittorio Colao promised to equip 99% of Italians with 5G networks by 2027, a goal that includes the construction of new mobile radio sites 5G fiber-optic bound to be completed by 2026.

For these reasons, the consumption of fiber optic cables increased by 8.1% in the first half of 2022. To this increase in demand is also added the energy crisis, which caused an increase of the production costs of materials such as helium and silicon tetrachloride, essential for the production of optical fiber. All this has caused an increase in prices that threatens to send the entire sector into crisis.

According to Michael Finch, an analyst at Cru, there is a risk that countries will not be "able to achieve the objectives set for the construction of infrastructure" and the current situation "could have an impact on connectivity global ".

Fiber Versus 5G: Why the Wired Connection Still Reigns

There's no doubt you've heard of 5G by now, and for good reason. The tech upgrade has promised cellular speed boosts of up to 10 to 100 times faster than the previous generation. It's so fast and powerful that the wireless signals can serve double duty, delivering both cellular connectivity and home internet service -- in turn, that could bring high-speed broadband to underserved areas and some much-needed competition to others.

But while 5G and what it can do for your new smartphone is certainly impressive, don't count on it to replace your home Wi-Fi service just yet, especially if fiber-optic internet is available in your area. 5G home internet shows strong potential, sure, but I'm not ready to recommend it over fiber, or even cable internet for that matter, as the most preferable connection type.

The same attributes that make 5G home internet appealing -- high speed potential, decent value and simple, contract-free service terms -- are also applicable, often even more so, to fiber. Plus, you'll get faster upload speeds, better speed reliability and more plan options with fiber internet versus 5G service.

That said, there may be times when a 5G home internet service makes more sense for your home than fiber, particularly if you want cheap internet or are trying to find internet in a rural area where fiber is unavailable. T-Mobile says its 5G Home Internet offering is available to over 40 million households today, while Verizon touts over 30 million households for its 5G Home service. Both carriers are continuing to grow their respective 5G networks, so expect both numbers to increase. 

So what's the deal with fiber versus 5G? I'll explain it all, starting with an overview of how the two technologies work.

A wired versus wireless connection

The main differences between fiber and 5G internet begin with how the two services reach your home. 

Fiber-optic internet sends data in light (optic) signals via long, thin glass wires (fibers), usually directly to your home on a dedicated line. Service runs to an optical network terminal, basically the fiber version of a modem, which establishes your internet connection. From there, a router may convert those signals into Wi-Fi, but the connection is fully wired all the way to your router.

5G (the fifth generation of wireless technology) sends and receives wireless internet signals over low-, mid- or high-frequency airwaves with each spectrum band having its own speed and range capabilities. Inside your home, a small, portable device receives the wireless signals and converts them into the connection you use for streaming, gaming, browsing, etc. Most 5G receivers have an Ethernet port or two to plug in a computer or gaming device, but otherwise your connection is entirely wireless as it enters your home and reaches your various devices.

Fiber speed test results after 30 days

Fiber speed test results after 30 days

Speed consistency is a significant advantage to fiber internet. In the past 30 days, daily speed tests consistently measured download and upload speeds above 900Mbps to my home over a 100% fiber network.     

David Anders/CNETIt makes a difference

Similar to connecting your computer to the modem via an Ethernet cable versus using Wi-Fi, a wired internet service is likely to be better equipped to deliver faster, more consistent speeds. 

Higher-frequency millimeter-wave 5G was an early focus for Verizon's 5G Home deployments, but Verizon and also T-Mobile have since focused on offering home internet over their respective midband networks. Midband 5G is much more widely available than millimeter-wave, particularly in rural areas. 

While not as wide ranging as low-band networks or as fast as millimeter-wave, it offers a solid mix of both speed and range with download speeds often around or over 100Mbps.

T-Mobile says that those with its 5G Home Internet offering can expect 'typical download speeds between 33-182 Mbps' while Verizon has previously touted that its service can hit average download speeds of roughly 85-300 Mbps for its midband 5G network, and 300 Mbps to 1 Gbps for areas that have access to its millimeter-wave 5G. 

Midband 5G networks are largely resistant to interference from obstructions or bad weather, but customers may experience slowed speeds due to network congestion. 

T-Mobile, one of the nation's leading 5G home internet providers, acknowledges the possibility of slowed speeds, disclaiming that 'during congestion, Home Internet customers may notice speeds lower than customers using other T-Mobile services due to data prioritization.' Admittedly, network congestion is a potential problem with wired internet services such as cable and DSL internet, too, but it's far less of a concern with fiber.

Most major fiber internet providers use a fiber-to-the-home (FTTH) connection, meaning each address on the network has a dedicated fiber line. The direct connection all but eliminates the threat of slowed speeds due to network congestion or outages due to obstructions or inclement weather. But don't just take it from me -- AT&T Fiber, Frontier and Verizon Fios are confident enough in their fiber networks to claim 99.9% reliability.

Fiber versus 5G speeds, pricing and service details

Reliability is comforting, but it's probably lower on your list of considerations when comparing internet services. What you're assuredly more interested in is what speeds you can get and how much it costs.

Here's a broad look at what to expect from fiber and 5G internet providers. Keep in mind that speeds and pricing, especially those of fiber service, can vary by location and the available providers in your area.

Fiber versus 5G home internet overviewTechStarting price rangeDownload speeds (mbps)Upload speedsTop providersFiber-optic$20-$300Up to 50-5,000Up to 50-5,000AT&T, Frontier, Google Fiber, Quantum Fiber, Verizon Fios, Ziply Fiber 5G home internet$25-$7035-1,000 range6-50 rangeT-Mobile, Verizon

At first glance, you'll notice that fiber has the higher speed potential and, should you opt for those ultra-fast multi-gig speeds, a significantly higher price ceiling. Don't get too caught up on that $300 price point, however. Most fiber plans fall in a much more reasonable price range of $40 to $90 per month.

I wouldn't get too excited about the low end of the pricing there, either. Ziply Fiber has the lowest starting price for fiber service I've seen, $20 per month for speeds up to 50Mbps, but that price doubles after the first year. Again, most fiber providers start at around $40 to $55 per month for significantly faster speeds, often up to 200-500Mbps depending on the provider.

As for 5G, the $25 pricing reflects a 50% discount for qualifying Verizon mobile customers on the carrier's base plan, which starts at $50 per month. T-Mobile also offers a $20 per month discount for its home internet if you have the company's Magenta Max plan for wireless service and at least two lines. 

If you can get those discounts, great, but if not, expect to pay $50 or $70 per month with Verizon. T-Mobile 5G home internet will also run you $50 per month.

Let's dive a little deeper and put the two head to head. 

Options: Choosing a speed versus accepting what's available

About those 'up to' speeds with fiber versus the speed 'range' with 5G home internet. 

Fiber internet typically comes with two, three or more speed tiers to choose from. Quantum Fiber (formerly CenturyLink Fiber), for example, presents two plan options: 200Mbps starting at $50 per month or gig service (940Mbps) starting at $65 per month. Others, including AT&T, Frontier and Verizon Fios, come with even more speed tiers to choose from and may also offer multi-gigabit speeds of 2Gbps or even 5Gbps (5,000Mbps) in select areas. You won't currently find speeds anywhere close to that with 5G home internet.

5G, on the other hand, presents a speed range because the actual speeds you get can and will vary by location, specifically how far you are from a local tower or transmitter. Consequently, 5G providers are unable to match the speed tiers and selection of fiber providers. 

T-Mobile offers just one 5G home internet plan, which may come with speeds anywhere between 35Mbps and 182Mbps. Verizon also offers only one 5G speed tier but the performance will vary depending on if you live in an area that can connect to the carrier's millimeter-wave network. If you can, expect download speeds between 300Mbps and 1Gbps. If not, you'll be using its midband 5G network, which offers download speeds ranging from 85Mbps to 300Mbps. 

The carrier does offer two plans, 5G Home and 5G Home Plus, but speeds should be the same with both. The extra $20 per month for Home Plus gets you an extra year of price guarantee, the ability to backup data to Verizon's cloud service and perks like a discount on a soundbar for your TV. 

All this is to say fiber internet is better suited than 5G to give you a selection of speed tiers to choose from. And again, a fiber-to-the-home connection is better equipped than 5G to deliver those speeds on a consistent basis.

Advantage: Fiber

Value: 5G can be cheaper, but fiber is the better value

Unless you qualify for the 50% Verizon discount or can get T-Mobile's bundle offers, fiber internet plans are typically a better value than 5G. 

Take for example AT&T Fiber and T-Mobile 5G home internet. AT&T Fiber's cheapest plan is $5 more than T-Mobile per month ($55 compared to $50), but it offers significantly faster download and upload speeds, not to mention the reliability of a 100% fiber connection.

But let's say you can get that 50% discount with Verizon. I'll admit, $25 per month for speeds ranging from 85Mbps to 300Mbps is a good deal and $35 for speeds ranging from 300Mbps to 1,000Mbps is an even better one, especially if your address is eligible for faster speeds. 

Still, you may find paying a bit more for fiber service to be worthwhile depending on the available providers in your area. Frontier's fiber service starts at $45 per month for symmetrical upload and download speeds up to 500Mbps. 

Though that's $10 per month more than Verizon's 5G plan for potentially slower download speeds, the faster upload speeds and superior reliability you get with fiber are, in my opinion, worth the extra cost.

Advantage: Fiber

Eli Blumenthal/CNET

Equipment fees, data caps and contracts

Speeds and pricing are perhaps the most important considerations when choosing the best internet provider for your home, but you'll also want to take into account added fees and customer service terms like data caps and contract requirements. 

AT&T, Frontier and a select few other fiber providers include the equipment rental in your monthly costs, so there are no additional charges for renting your modem or router. Others, like Kinetic, Quantum Fiber and Verizon Fios, may tack $10 to $15 in equipment fees onto your bill. There are often ways around the fee, such as using your own router or selecting a plan that includes equipment at no extra cost.

As for data caps and contracts, nearly all fiber internet providers offer unlimited data and come with no contract requirements. The possible exception there would be Frontier Fiber, which may require a one-year contract if you opt to receive any promotional deals such as gift cards with your order.    

Expect nothing with 5G service (that's a good thing)

OK, slight advantage to 5G here. T-Mobile and Verizon are about as straightforward as it comes with their 5G home internet pricing and service terms. Your equipment is included at no extra cost with both providers, as is unlimited data and contract-free service. Taxes and fees are even baked into the sticker prices.

You also won't have to worry about any immediate price hikes. Verizon 5G home internet comes with a two- or three-year price guarantee depending on the plan you choose while T-Mobile advertises your price is 'locked in.'

Advantage: 5G home internet

All things considered, I recommend fiber

There's no denying that the arrival of 5G is a win for our phones, but the technology isn't quite ready to replace a fiber-to-the-home internet connection. While the pricing and service terms are impressive, it's not enough to turn me away from the speed, reliability and value of fiber internet right now. 

That said, considering there are no contracts and essentially no risk with either 5G service, you may want to try it out to see what speeds and reliability you can get -- it could even help you negotiate a better deal with your current internet provider. Just don't expect the service to perform like a fiber-optic connection.