Verizon’s FTTP Plan Takes Shape

Verizon has unveiled new details about its strategic
fiber-to-the-premises (FTTP) push, including pricing, data speeds,
future markets and a launch date for television service.

The carrier’s Fios (pronounced “fye-ose”) service will be available to
consumers in Keller, Texas, in coming weeks. It features three tiers of
Internet access speeds: 5 Mbps, 15 Mbps and 30 Mbps. Each is available as
part of a bundle with phone services or as standalone Internet access.
Pricing starts at $34.95 for the most basic service.

Verizon is betting that FTTP, with its fast speeds and ability to carry
data, voice and video, will lure customers from rival telecoms and ISPs that
offer digital subscriber line over copper and cable operators
selling broadband through coax.

Though it’s starting the rollout with high-speed Internet access, a key
reason Verizon is investing in FTTP is its ability to carry television
programming — a hole in its bundled communications offerings. The company
plans a Fios video offering in 2005.

Verizon also announced the next communities slated for Fios. In California,
fiber will be available to about 100,000 homes and businesses in the
Huntington Beach area. The company will begin a similar rollout in Tampa and
parts of Hillsborough County in Florida.

Joe Laszlo, a senior analyst at Jupiter Research, said Fios could shake up the U.S. broadband market.
(Jupiter Research and internetnews.com are owned by Jupitermedia.)

FTTP, as well as the back-end network, should be able to support television, Laszlo
said. And if Verizon assembles an attractive programming option, it could
lure customers from Comcast , Time Warner and others.

Smaller telecoms that have offered TV programming have typically been able
to convince 20 percent to 30 percent of their voice customers to sign on for
TV, Laszlo said. “The goal is for a bundled triple play of video, high-speed
data and voice,” he said.

A successful deployment of television by Verizon could prod cable operators to act.
The most likely reaction would be to bump up speeds of their high-speed
Internet offerings and more aggressively pursue their own voice offerings,
including Voice over Internet protocol (VoIP) , Laszlo said.

Laszlo is still cautious about Verizon’s goal, noting that previous new
technology deployment goals set by large telecoms have tended to be too
optimistic.

Still, even if there is some slippage in the timetable or the number of
homes passed, Verizon’s FTTP deployments this year should give Baby
Bells a good idea of how the technology works and what kind of services and
applications are attractive to consumers.

In recent years, broadband industry watchers have included FTTP among a
litany of emerging technologies that could one day replace copper-based
digital subscriber lines and cable modems. A small, but growing number of
independent carriers, housing developers and public/private partnerships
have led the way in helping to develop fiber-based, last-mile broadband
access.

But large carriers, wary of the costs of buying and installing miles of
fiber-optic cable, have proceeded cautiously — except for Verizon.
Earlier this year, it announced plans to pass 1 million homes and businesses
in parts of nine states with fiber by the end of the year.

Verizon’s movement has forced others
to take a hard look at the technology. SBC Communications
recently
committed
$6.2 billion to a fiber rollout over the next five years.

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