In the following video, Austin Smith and Jeremy Phillips refer to the idea of a "dumb pipe" that merely transmits data to consumers.

"Dumb pipe" status is not ideal, and for Austin, Verizon and Comcast come to mind as two examples. Austin notes that both are widely disliked yet serve vital roles in the economy.

Asked to choose one, Jeremy picks Comcast. He likes how the company is trying to move up the food chain by acquiring NBC Universal and starting to produce its own content.


Austin agrees on Comcast, though he notes that Verizon has made a deal for Redbox in a move that could be construed as a step toward becoming a "smart pipe." Both, however, say they wouldn't buy Comcast or Verizon.

Verizon is the highest-yielding stock on the Dow Jones Industrial Average, but Jeremy doesn't see it as a buy today. Instead, if you're looking for income, read up on "The 3 Dow Stocks Dividend Investors Need." It's absolutely free, so simply click here now and get your copy today.

The article Better "Dumb Pipe": Verizon or Comcast? originally appeared on Fool.com.

Austin Smith and Jeremy Phillips have no position in any stocks mentioned. The Motley Fool recommends and owns shares of Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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