Verizon kicks off FTTP outside Dallas

Dallas--Verizon Communications kicked off its long-anticipated, large-scale fiber-to-the-premises (FTTP) buildout today, naming the first city to which it will deliver commercial triple-play services via fiber: Keller, Texas, a small town just west of Dallas. All of Keller's approximately 33,000 residents and their 16,000 homes will have access to fiber by the end of the summer, Verizon said.

  "FTTP is real, and it's happening here first" said Paul Lacouture, president of Verizon's network services group, at an outdoor press conference held in Keller's upscale Williamsburg Estates residential community, only blocks away from where Verizon technicians were installing equipment underground.

  Lacoutre's remarks may have been directed toward skeptics who have questioned Verizon's commitment to FTTP since it and other Baby Bells announced plans to pursue the space last summer. Verizon has already planted about 420,000 feet of fiber beneath the city of Keller and invested $15 million in fiber deployment there, Lacoutre said before repeating and reaffirming the company's goal of passing 1 million homes with fiber by the end of the year (and twice that in 2005), including additional towns in Texas and eight other states. "The eight states you would think about," Lacoutre said, hinting at Verizon's local service territory. "Most of them are in the northeast." Expansion of FTTP outside that territory could come later, he said. "First we've got to get it working in our territory."

  In addition to having enough bandwidth for four phone lines, Keller residents will have their choice of three different high-speed broadband offerings. For the most casual users, Verizon will offer 5 Mb/s downstream and 2 Mb/s upstream. For the heaviest users, including telecommuters, Verizon will offer 30 Mb/s downstream. But the company expects most users to fall between the two, opting for its 15 Mb/s downstream, 2 Mb/s upstream service. Verizon will also offer services to Keller's 723 businesses but didn't provide specifics other than to say it plans to offer IP VPN service.

  Verizon won't comment on prices for its FTTP broadband services, but Robert Ingalls, president of the company's retail markets group, said prices for the 5 Mb/s and 15 Mb/s services would be "very much in line with" prices that cable and DSL competitors are charging for 1.5 Mb/s service.

  Verizon will add video service to FTTP recipients in Keller in 2005, but the company hasn't yet decided how it will do that. Verizon has a partnership with DirecTV but will also evaluate video aggregation options and the content rights it has to a small cable cooperative left over from GTE.

  "Content is one of the issues we have to solve; we don't have it solved," Ingalls said. "We have access to content through several means."

  In the future, Verizon also wants to add home networking offerings to its FTTP customers.

  Keller was chosen because it is suburban and fast-growing, with demographics amenable to triple-play services, Lacoutre said. According to the town's economic development director, Woody Mitchell, Keller is adding 1000 new residents and 40 to 60 businesses a year, a rate that could increase after the town gets FTTP.

  Verizon, which is the local telephony incumbent here in the area west of Dallas that was formerly occupied by GTE, already has plant in the ground and offers DSL in Keller. As a result, Verizon knew the extent of broadband demand here. And because early FTTP deployments typically involve aerial infrastructure, Verizon will be able to compare its economics to that of underground deployment.

  Verizon's engineering headquarters and operational headquarters for western U.S. markets are both located in Texas. And the company will soon open a national technical support center for FTTP customers in Dallas, initially creating 50 new jobs, Verizon said.

Keller's incumbent cable provider, Charter Communications, provides broadband here, according to Verizon. But Mitchell said he gets one to two calls each week from city residents complaining about the lack of available broadband service.

  "There are certain communities where [cable competitors] have taken a double-digit percentage [of marketshare] from us," Ingalls said. "I think this is the same kind of game, just in reverse. I think we can get a reasonable share."