Fiber Deployment Costs May See Slight Slowdown

WASHINGTON, Feb. 6, 2025 – The cost of deploying fiber broadband continues to rise, but the latest report from the Fiber Broadband Association and Cartesian suggests price increases may moderate in the coming year.

While underground fiber deployment costs surged by 12% in 2024, aerial deployments saw only minor cost increases, and industry experts believe the worst of the inflationary squeeze on fiber projects may be over, according to the 2024 Fiber Deployment Cost Annual Report.

The study, presented in a webinar Thursday, was presented as underscoring the role of state and federal broadband funding programs in expanding fiber access. Despite economic challenges, 57% of U.S. households were now serviceable by fiber.

"Well over half of all U.S. households — about 57% — have access to fiber," the report noted. "This reflects the strongest year-over-year growth in coverage in percentage points over the last decade, increasing from just under 51% coverage in 2023,” said Megan Corriveau, manager at Cartesian’s Strategy and Analytics Practice.

The median cost of underground fiber deployment climbed to $18.25 per foot, up from $16.25 per foot in 2023, while aerial fiber deployment remained relatively flat at $6.55 per foot.

Labor remained the dominant expense in fiber projects, accounting for 60 to 80% of total deployment costs. The median labor cost for underground deployment was $13.23 per foot, compared to $4.35 per foot for aerial builds.

"Labor generally accounts for roughly two-thirds of the overall deployment cost," the report found. "This share is higher for underground at 75% of costs, so roughly three-fourths of deployment costs are attributable to labor for underground deployments. For aerial, it’s a bit lower, at 63%,” said Corriveau.

Reported costs for internal labor were half those of outsourced labor. Still, roughly 75% of respondents use outsourced labor rather than internal teams. The median cost of underground fiber deployment with outsourced labor was $19.95 per foot, compared to in-house crews, which came in at $9.00 per foot.

Aerial fiber deployments, which involve running fiber along utility poles, were cheaper and faster but come with their own cost barriers. Providers that own their own poles reported deployment costs of $4.90 per foot, compared to $7.00 per foot for providers leasing space on third-party poles. Make-ready work and permitting delays were also key concerns, with respondents noting rising costs in both categories.

The study pointed to ongoing public and private investments in fiber broadband as a critical driver of deployment, particularly in rural America, where costs are often higher due to challenging terrain and sparse populations. 

The report also highlighted record-breaking fiber expansion in 2024, with 8.4 million new homes connected — a 13% increase from the previous year. The FBA projects that fiber will reach 80% of U.S. households by 2028 and is on track to hit 90% by 2030.

As providers look ahead to 2025, the industry remains cautiously optimistic. While 41% of respondents reported significant cost increases in 2024, only 25% expect similar jumps in 2025. The expectation was that material and labor costs will still rise but at a slower pace.

“The landscape is continuing to evolve, and deployments aren’t going to slow down anytime soon,” said Corriveau.