This did pretty much happen with railways during the industrial revolution. Huge amount of money was invested into railway build-outs and most investors lost their money even though the result was useful in the long run (though only a subset of what was built).
The bottleneck was the phone line running into individual houses. ie The "last mile" was a bottleneck. Dial-up. If you're old enough you will remember people connected to the internet via Dial-up, that is, their phone line. It was a bottleneck. It's data capacity was nowhere near what the fiber was.
