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CABLE SURFING: In the future, a different TV choice could be a phone line away
[April 02, 2006]

CABLE SURFING: In the future, a different TV choice could be a phone line away

(Reading Eagle (PA) (KRT) Via Thomson Dialog NewsEdge) Apr. 2--AS CABLE BILLS go up and up, year after year, you might find yourself wishing your carrier didn't have a monopoly.

Oops! That's right -- it doesn't. It only seems that way: By law, multiple providers are welcome to carry cable service within a given area.

But the deep pockets required to overlay equipment and lines make such competition cost-ineffective. And, as the cable industry is happy to point out, there are other options: satellite, for example, and even the airwaves, via the rapidly nearing-extinction antenna.

But now, competition in cable is becoming a reality.

Late last year, Verizon began offering cable services in Keller, Texas, and has by now expanded it to about 40 communities in several states.

Terri Turner, assistant manager of Aventine Apartments in Keller, a Dallas suburb, switched to Verizon's service from the Dish Network and says she now gets more channels for less money, plus a clearer picture.

"It's all the channels I had and more," Turner said. "The on-demand is pretty convenient, too, as well as pay-per-view. People talk about it quite a bit. We're a brand new apartment community and we're the first to have the fiber optics laid throughout the community. This has been a great marketing tool for us."

Three municipalities in southeastern Pennsylvania have signed franchise agreements with the carrier. Verizon has not indicated when customers there will begin receiving the service.

Nor has it announced any plans to bring it to Berks County.

Still, with other former Bell companies getting into the act, competition is gaining traction.

"The question every day is, 'When are you coming to my neighborhood next?'" said Sharon Shaffer, manager of media relations in central and eastern Pennsylvania for Verizon.

Verizon's service, called FiOS TV, provides various packages, but its core, expanded basic package costs $34.95 per month and offers about 180 digital channels, including local network affiliates; dozens of digital music channels; and more than 20 high-definition channels.

Premium sports and movies packages as well as on-demand and pay-per-view services also are available where it is offered.

Verizon supplies FiOS -- not an acronym -- through fiber-optic lines that also bundle voice and high-speed Internet services. As such, the service only can be rolled out as quickly as the company can string or lay those miles of cables.

Verizon would not reveal how much it has budgeted toward its FiOS program other than to call the program capital-intensive. Some sources have priced it in the tens of billions of dollars.

But, with the potential for bundling Internet and voice along with TV services, the potential rewards are huge, and response has been encouraging.

The company said it has achieved 30 percent market share in Keller since its startup in September. In Temple Terrace, Fla., near Tampa, it has reached 11 percent, and 5 percent in Herndon, Va.

Kevin M. Lahner, assistant city manager in Keller, said Verizon competes there with Charter Communications, which extended an existing offer to new customers of $49.95 per month for its biggest cable package plus high-speed Internet. Normally, those would be priced at a total of $103.98.

"What Charter will tell you is, that's not in response to Verizon," Lahner said.

Although Verizon negotiated a franchise agreement with Keller, Texas subsequently approved legislation providing statewide franchising, which means that Verizon or other providers need not obtain agreements with each individual municipality -- a painstaking process the phone companies have argued is stalling competition.

F. Thomas Snyder Jr., borough manager of Schwenksville, one of the three Pennsylvania locales where Verizon has signed franchise agreements, said that under the agreement, the borough receives 5 percent of Verizon's gross revenues in the area, which is a standard arrangement, and equivalent to what it gets from Comcast.

Verizon would not comment on how it selects its FiOS areas, but Snyder said that although Schwenksville is small, it had a fairly complex overlay of telephone service areas and that he believed the fiber-optic cable would help the provider straighten out its exchange problems.

With cable providers also offering voice and Internet services, not only does real competition seem to be on the horizon, but also a ramping up in the quality of the delivery of those services.

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