This is called the one-off approach. As you can see, such a model is hard to scale. The alternative, often taken by ILECs, is to build out infrastructure in major metropolitan areas in anticipation of service demand. In the days of regulation, such an investment was safe from competition and was a good, profitable bet. This approach still works well enough for ILECs in some cases but doesn't help CLECs much, or even ILECs looking to build out of region.
PONs change the equation significantly by allowing a more opportunistic model.
Let's say a carrier wants to target a town square but isn't sure which businesses will sign up for service. This new paradigm would move ahead of the growing bandwidth requirement. The same is also true for overlay networks where new facilities are being installed, especially where the outside plant is aerial, says Mark Klimek, director of PON marketing at Alcatel. The major cost of building a network is installation of the outside plant, and if the trenches have to be opened anyway, there isn't much difference between laying fiber or copper. As mentioned earlier, PONs have no active outside components, and that includes optical amplifiers.