Verizon announces new fiber network for pay TV services

Verizon Communications is building a new fiber-optic network in six states — as part of a $2.8 billion expansion effort to compete with cable television operators.

The network will be used to deliver high-speed Internet service and television services to homes and businesses. Verizon will introduce a package of television programming next year.

The company has already installed fiber technology and Motorola set-top boxes in California, Florida and Texas. It will now broaden its program to Virginia and parts of Delaware, Maryland, Massachusetts, New York and Pennsylvania.

Nationally, one million homes and businesses will be able to buy Internet service on the new network by the end of 2004 and three million by the end of 2005.

The company will soon offer its own cable like TV service to some customers and expand rapidly over the next few years. It plans to offer lots of channels, including high-definition broadcasts.

To accomplish this, Verizon must rebuild a century-old network of copper lines that run into almost every home in the area. The telco aims to reach three million homes and businesses by the end of 2005 - about 10 percent of the 30 million homes within its territory.

Current Verizon customers would pay $35 a month to surf the Internet at speeds of 5Mb/s — more than three times as fast as the company’s DSL service. Small businesses could get speeds of 30Mb/s for just a few dollars more.

To install the fiber technology in its network, Verizon said it would hire 3,000 to 5,000 employees within the next 14 months. The company is spending $800 million this year on fiber installment.

Verizon’s announcement follows a similar announcement by SBC Communications. (See SBC builds digital network). SBC plans to spend $6 billion to connect 18 million households within three years instead of the previous five-year estimate.

Verizon said it plans to reach at least 1 million homes this year and an additional 2 million homes in 2005 with its speedy fiber access.

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