May 9, 2005 4:52 PM PDT

Verizon hits the gas on fiber campaign

Verizon Communications has taken its Fios marketing campaign to the streets, sending out Hummers wrapped in banners with logos for the new fiber-to-the-home service.

The mobile billboard campaign, which has already kicked off, is one of many targeted marketing moves the company is using to drum up interest in Fios. The new fiber network is planned to eventually carry telephony, television and high-speed data services directly into people's homes.

Since last year, Verizon has quietly spent billions of dollars while digging up streets to lay the new fiber network in neighborhoods in half of the states where it provides local phone service. So far, it has done little marketing to promote the Fios network and services. With about 250 communities up and down the East Coast and in Texas now hooked up, Verizon is turning up the marketing heat in those places as it looks to sign up new customers.

high-speed fiber

"Because the service isn't universally available, we've deliberately tried to make the marketing very local, to create excitement in areas where the services are being offered," said Sharon Cohen-Hagar, a spokeswoman for Verizon.

In addition to sending the large vehicles out to towns like Tampa, Fla., and Keller, Tex., Verizon has also put up billboards on highways and sent direct-mail fliers to homes in areas it now serves. It is also setting up temporary storefronts, or "Fios lounges," in certain communities, such as Falls Church, Va., to give customers hands-on demonstrations of the network's capabilities.

"Fios lounges" differ from Verizon's traditional retail stores because they house kiosks connected to the Fios network that people can use to "test drive" services such as interactive games. The company has even set up TVs in viewing areas so that people can watch promos of the new television service that Verizon expects to introduce later this year.

So far, cable companies--Verizon's main competition in this market--say the fiber-to-the-premise service has had little impact on their businesses. On a conference call with investors last week, Tom Rutledge, the chief operating officer of Cablevision Systems, said Verizon had only won a handful of customers so far. But Verizon argues that its Fios marketing campaign has just gotten started.

Still, some analysts say Verizon has a long road ahead of it. "Building awareness of the concept and of the brand name, which isn't that compelling to begin with, will be the biggest challenge for Verizon," said Jim Penhune, an analyst at market researcher Strategy Analytics. "Because they are rolling out the service one town at a time, they must be very specific in the marketing. This was always somewhat of an issue for the cable companies in marketing their own services."

Verizon is offering Fios at several tiers, with discounts for customers who subscribe to other Verizon services. The base plan offers download speeds of up to 5 megabits per second, with an upload speed of 2mbps for $39.95. For $49.95, consumers can get download speeds up to 15mbps, and for $199.95, users can download at 30mbps and upload at 5mbps.

That compares with Verizon's digital subscriber line, or DSL, service, which the company offers at 1.5mbps for $29.95 in most regions. In select locations, it sells 3mbps DSL service for the same price.

But critics wonder if Verizon will be able to provide customers with compelling-enough reasons to upgrade to Fios, given that the network performance at the price points offered are so close to what's already sold by cable operators. What's more, it's doubtful that Verizon will win many customers in the highest-tiered service, since few consumer applications exist that need that much bandwidth.

"Most people wouldn't even know what to do with that much capacity," Alan Bezoza, an analyst at Friedman, Billings, Ramsey Group, said in an interview last week.

8 comments

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Server Limit Bandwidth
You know it's a "little know fact" that most IT guys that offer downloads on there site, or similar services, cap the bandwidth that you can be sucked from there servers anyway.

With that said, 3MB, 512k, and 256k lines all have the same characteristics on today's internet. So why would anybody want to go with any other service other than DSL or Cable(my pref-T3 compared to and average of 512k with DSL).

And besides, we live in a "Wireless" world.
Posted by OneWithTech (196 comments )
Reply Link Flag
Some ppl
Like to download more than 1 file at a time from different sources. Say Like game demo's Those can take a while, a hour or 2 DSL time for one 100 mb file.

Or if someone wants to run a game server with 60 or more ppl they going need something fast then DSL. At least for rtcw that is true.

So from gamers point of view faster = better, and the faster the net gets the more detailed the Multi-player games get and more ppl in a single arena makes for a heck of a fun time.
Posted by simcity1976 (136 comments )
Link Flag
Awful TOS
I looked into FIOS, but they have terms of
service (TOS) that more or less undermine the
value of the whole thing. The big selling point
of FIOS is the upstream bandwidth, but the TOS
forbids you to accept incoming network
connections or establish outbound connections
that might direct traffic to a subscriber system
(namely, no "server software" of any kind).

It seems most people ignore the TOS and counsel
other to do the same, in part because Verizon is
so lax about enforcing them (probably
intentionally so). The consensus being that
Verizon only intends to pull the plug on those
that "abuse" the service. Yet the TOS doesn't
say that -- it says nothing of the sort and
doesn't qualify what might be "abuse".

Your other option is to adhere to your contract
and obey the TOS. But then, the service is much
less valuable. You couldn't for instance, play a
networked video game where on participant's
computer is the game server. Some
video-conferencing and collaboration tools use a
client-server model that would be forbidden, so
there's a hindrance to telecommuting. Exporting
your X11 desktop at work to your PC at home to
check your office e-mail -- not allowed. Want to
share those pictures and videos of the kids?...
Forget about doing it from home. The restriction
is quite silly, if you ask me.

Oh, and they block port 80. Not a big issue, you
can work around it, and they do it because of
the prevalence of Windows systems (that are
susceptible to various attacks through
misconfigured IIS). However, I think together
this is evidence of a lack of sense about what
makes broadband attractive and how to manage it.
The unpatched IIS systems are easily detected
and selectively blocked automatically, and using
a different port is possible, so the block is
really nothing more than an intentional
nuisance. The terms of service really undermine
the value of the product to anyone that adheres
to them. If they want to prevent abuse, spell
out what abuse is, but the existing restiction
is not only ill-conceived, but also probably not
enforcable (since they not only don't enforce
it, but in their advertisements they frequently
endorse its violation by touting GoToMyPC.com
and such).

I'm the sort of person that's apt to stick to a
contract if I sign one, so the Verizon FIOS
service is worth, to me, perhaps a 1/3rd what it
is to their typical scofflaw customer.
Posted by Gleeplewinky (289 comments )
Reply Link Flag
What are Comcast's TOS?
I don't actually want to check myself because it surely is a very long, boring, non-english document. However, I would imagine that their TOS has similar restrictions which no one actually heeds.

The only reason these clauses exist is so that they can't get sued for stuff. If they said Hey everyone, using file sharing clients on our network is totally OK with us, some people might have a problem with that. But if they write that you can't do that, then they can say Hey, well that's actually against our TOS so if you have a problem, go talk to that guy.
Posted by whiterabbit--2008 (34 comments )
Link Flag
Fiber to the Home, Sign Me Up!
Hi All,

Fiber the home will allow me to dump Comcast TV and Internet and replace it with Direct TV or Dish TV, Dump Comcast Internet and replace with Fiber. All Cheaper than Comcast.

Comcast is destroying my will to live, with all the price hikes and there Internet is fast to there office, but speed may vary wildly once you go past that.

Joe
Posted by gunnerjoe (6 comments )
Reply Link Flag
$$$$$$$!!!!!!!!!!!!!!!!!!!
$200 A MONTH!!!!!!!! NO WAY IN HELL!!!!!!!!!!!!!
Posted by broomfighter (7 comments )
Reply Link Flag
 

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