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Verizon's Fios TV is coming to New York City starting Monday.

The phone company sent a media advisory on Friday about the launch and will provide more details about the service during a Webcast press conference Monday morning. New York City granted Verizon its TV franchise back in May. And on July 16th, the company won final approval to offer its TV service from the New York Public Service Commission.

Verizon has been aggressively marketing its Fios Internet and TV service in the New York City suburbs for the past couple of years. And the company has offered the Fios high-speed Internet service in some apartment buildings in New York City. Now the company will be able to offer a complete package of telephony, TV, and broadband services to New Yorkers, helping it compete head-to-head with Time Warner Cable, the predominant cable operator in the city.

Verizon's Fios service uses a new fiber network that extends directly into people's homes to deliver nearly unlimited bandwidth capacity.

Technology blogger Dave Zatz reported earlier this week that Verizon will soon offer Web-based videos as part of its Fios TV offering through its set-top boxes. Initial Internet video partners include YouTube, Veoh, Blip.tv, and Break.com, the post said.

There's no question that Verizon Communications hit a home run with its aggressive fiber strategy.

The fiber-to-the-home network called Fios has enabled Verizon to supercharge broadband speeds and compete against cable in the TV market.

Fios also has helped future-proof Verizon's network. While its cable competitors buckle under the pressure of peer-to-peer traffic on their networks, Verizon has enough capacity in its network, thanks to its fiber upgrades, to weather the storm unscathed and work on its own timetable to find more efficient ways to handle peer-to-peer traffic.

Mark Wegleitner, Verizon's senior vice president of technology in charge of broadband and consumer services, has helped develop and drive Verizon's fiber strategy. I sat down with him at the Nxtcomm trade show in Las Vegas last week to talk about a wide variety of topics, including the controversy over Comcast's treatment of BitTorrent traffic, faster speeds for Fios, and what the company plans to do next when it reaches its 2010 goal of passing 18 million homes with fiber.

Below is an edited excerpt from that conversation. Feel free to share your thoughts after in the "TalkBack" section.

Q: As you know, Comcast got caught slowing down peer-to-peer traffic on its network. As a network provider yourself, do you think it's necessary to manage your customers' traffic?
Wegleitner: I think we can come up with scenarios where network management would be necessary. While there might be plenty of bandwidth out there, you can't really guarantee that you can get an error-free transmission of, say, a video file that will be guaranteed at a specific point in time. That is why you might need rational network management.

So what would you consider to be acceptable network management?
Wegleitner: It's still a work in progress. But it's important to ensure the capabilities of applications.

But is it acceptable to identify and slow down specific types of traffic like BitTorrent or other peer-to-peer applications?
Wegleitner: Well, it's sort of a glass-half-full situation. Degrading traffic for one application enables another to work better. But we have to allow people who use the peer-to-peer applications for lawful and legitimate purposes to do so.

Verizon is working with several peer-to-peer companies to find ways to use the technology to distribute content more efficiently. How can the P2P protocol benefit service providers like Verizon?
Wegleitner: Peer-to-peer is a distribution enabler. But often when people talk about P2P, it gets lumped into a category with things that are bad, mainly because it takes up so much capacity on the network. But whether it's a good thing or a bad thing, there is underlying technology for P2P that can be used to everyone's advantage to get content like video, which everyone is asking for, distributed in the most efficient way.

We conducted some tests with the P4P group and Yale University, and showed that customers have a better experience, and we use fewer resources, when we used the P2P technology. It's really a win-win situation for us and the customer.

Degrading traffic for one application enables another to work better. But we have to allow people who use the peer-to-peer applications for lawful and legitimate purposes to do so.

And we're still working cooperatively with P2P companies and the rest of the folks in the P4P group to employ the technology in a way that would maximize its impact.

Verizon has said it expects to pass 18 million homes with its Fios fiber- to-the-home service in 2010. Where are you guys in that deployment?
Wegleitner: I'd say we are slightly ahead of schedule for homes passed. But in general, I'd describe us as on schedule. We will have 12 million homes passed this year, which is the goal we had previously stated.

Verizon announced recently that it's increasing the speed of its Fios service to 50Mbps on its high-end tier of service. How much faster can the speeds on Fios get?
Wegleitner: The original specification for the Passive Optical Network, or the FTTP network, we are using allows us to provide 100Mbps to the home. So that's probably a reasonable ceiling, given the current technology. But we are also deploying GPON, which is an enhancement to the original fiber technology we're using.

The specification for that calls for 200Mbps to the home, with 400Mbps peak utilization. But we'll probably see the next generation of technology allow us to deliver between 125Mbps and 175Mbps to the home. We are working with suppliers for that technology to go even faster. But 100Mbps is within range, and we could even go a little higher.

Are people really using the 50Mbps service?
Wegleitner: Under specific circumstances, transferring files at 50Mbps is better than 10Mbps. The key here, though, is concurrent use. In the old days, when you had one PC, there probably wasn't much need for these kinds of speeds. But now there are multiple devices connected to broadband in the home. And that number is only going to grow. So it's important to have the performance there.

Verizon has begun selling a bundle that includes Verizon Wireless service and high-speed Internet and video, and no home phone line. How long before you think that the old landline telephones will be obsolete and will disappear altogether?
Wegleitner: In the broadband world, voice service is a small increment of traffic, in terms of bandwidth and cost. And in a converged world, we can give people who keep a voice over Internet Protocol (VoIP) landline a rich set of features. So I don't know that it won't be a useful service for a large portion of the population. I don't think the last chapter has been written on voice yet.

So when you talk about new voice services, are you talking about offering unified communications in the home?
Wegleitner: Yes, we can offer a unified communication experience in the home today with point solutions. And we have run way left for more sophisticated and converged services.

When will we see these services?
Wegleitner: We can already provide the ability to forward calls. But the find-me and follow-me services haven't caught on as rapidly as we thought. Sometimes the first time an application comes out of the shoot, it doesn't catch. But then later, it does. I don't think we've created enough selection or a compelling-enough template to drive mass-market adoption of some of these services yet. But that will come. I don't think we're talking more than a couple of years away.

Verizon's original Fios plan goes through 2010. What happens after that? Will Verizon continue to deploy fiber to more customers in its footprint, or will you focus more on DSL?
Wegleitner: I think there is more gas in the engine for fiber-to-the-home beyond 2010 that will help us get into the remainder of households in our footprint. Will we cover all the homes in our footprint? Probably not.

In the lowest-density areas, it's hard to justify new wireline deployment. And technically, DSL is available over copper. But it has limitations on long loops. Wireless solutions are attractive in these rural areas. We are looking at options in that area. But it's worth noting that even many of the small towns in our footprint are still within miles of a city center. So it's only about 30 percent that is out in low-density areas.

Right now, the primary horse we are betting on will be 3G and 4G solutions for wireless.

Would Verizon use LTE or WiMax to provide wireless broadband in those rural areas?
Wegleitner: Well, LTE is the horse we are riding right now. So that will likely move to the head of the line, in terms of the high-speed wireless-broadband data service we'll offer. We are already offering direct broadcast satellite for video delivery where we aren't offering Fios TV. So we could pair DBS with wireless data to also offer a triple-play offering in those rural areas.

Some of your cell phone competitors, such as AT&T and T-Mobile, are using Wi-Fi in different ways to extend their broadband networks to public hot spots. T-Mobile is actually using it to augment its cellular voice service. Will Verizon use Wi-Fi?
Wegleitner: We might see Wi-Fi used in the home to provide multiple device interconnection. Right now, we are using the Multimedia over Coax Alliance (MoCA) cable standard to deliver connectivity using the existing cable infrastructure in the home. But we could use other kinds of connectivity in the home, such as Wi-Fi or power line.

But as far as offering Wi-Fi in hot spots or covering whole communities with Wi-Fi, we've tried it. We provided Wi-Fi in Manhattan, but we no longer offer that service.

I remember that. A few years ago, you guys turned your existing phone booths in Manhattan into Verizon Wi-Fi hot spots. But when you rolled out EV-DO service, you shut down the Wi-Fi hot spots. Why?
Wegleitner: The economics just didn't pan out. I think right now, the primary horse we are betting on will be 3G and 4G solutions for wireless.

Speaking of 4G, there's been so much talk about moving to the next generation of wireless networks. What do you see as the biggest challenges in building and running the next-generation broadband wireless networks?
Wegleitner: One challenge will be the sheer number of new devices on the network. It's a double-edged sword. There's more capability for end users, but it also means that the network provider has to understand these capabilities. There's not going to be a common denominator, so we will have to be able to identify and recognize the devices and their capabilities, and adapt to it.

The other thing is that we'll need additional management for all these devices. We'll have to be able to localize problems, identify them, and be able to fix them. And we'll have to make sure we can do this at a reasonable cost.

LAS VEGAS--Verizon Communications is looking toward big cities as the next big opportunity for its Fios broadband and TV service.

The company said Wednesday that it expects to get approval from the New York Public Service Commission to offer its Fios video service in New York City as early as next month.

"Our plan is to cover all of the 3.1 million households in all five boroughs in the next five to six years," Verizon's COO Denny Strigl said during a keynote speech at the NxtComm trade show here. "We will start this year as soon as we receive the approval of the New York Public Service Commission, which we expect will be next month."

Verizon is also working to get video franchise approval for the Fios TV service in other large cities such as Philadelphia and Washington, D.C., Strigl said at a press conference after his keynote.

Verizon sees cities as a huge opportunity for the Fios service, which provides high-speed Internet service, telephony, and cable TV service over a super-fast fiber connection. Because most customers in big cities such as New York City live in large apartment buildings, Verizon has had to adapt its installation process.

This proved to be a technical challenge for the company when it first started deploying Fios a couple of years ago. But the company has since started using bendable fiber optic cabling and has solved many of the issues associated with deploying the service in these buildings.

"Providing Fios in large cities is very important to us because the economics of multiple dwelling units is very good for us," Strigl said at the press conference. "When you think about it, the ability to pass a building that has 300 apartments is much easier than deploying service to an acre or half an acre for a single-family dwelling. So it's a very good growth opportunity for us."

Strigl also confirmed that the company is looking to expand its Fios service out of region on a limited basis. Specifically, he said the company will look to deploy Fios service in neighborhoods that are adjacent to its current footprint. The company has already begun deploying fiber in certain neighborhoods around Dallas, where AT&T also provides service.

But Strigl emphasized that this was not a wide-scale change in strategy to take the Fios service out of region.

"What we are doing on a limited basis is, where it's economical, we are offering the complete Fios solution in neighborhoods next to ones we already serve," Strigl said.

He explained that these neighborhoods can easily be served by existing Verizon central offices, which means the capital expenditure to move into the neighboring area is minimal. He wouldn't say where, other than the Dallas area, Verizon had considered doing this. But he didn't rule out extending service into some areas in California, such as around Los Angeles.

Strigl also announced Wednesday that Verizon has upgraded the speed of its Fios broadband service across its 16 state region. The highest-tier service will offer 50 megabit-per-second downloads and 20Mbps uploads. Verizon had offered this upper tier of service in only a handful of markets previously.

The company has also doubled the upload and download speeds of its lowest-tier Fios broadband service. The service will now offer 10Mbps downloads and 2Mbps uploads.

LAS VEGAS--Verizon Communications is boosting speeds for its Fios fiber-to-the-home service, the company plans to announce Wednesday.

The company's COO Denny Strigl is expected to announce the speed upgrades during his keynote speech at the NxtComm trade show here. The upgrades come as Verizon customers use more bandwidth intensive applications such as video downloading and photo sharing.

"The appetite for bandwidth shows no sign of slowing down," Strigl said in a statement. "Neither will we. We've already had successful trials of the 100-megabit home, which will be a reality faster than anybody thinks."

As part of the upgrade, all Fios customers will now have access to download speeds of 50 megabits per second and uploads of 20 Mbps for about $140 a month. The company is also offering its symmetrical 20 Mbps download and 20 Mbps upload service to all Fios customers for $65 a month.

Verizon had already been offering these speeds in certain markets such as Connecticut, Massachusetts, New Jersey, and New York. But now the service will be expanded to Verizon's entire Fios customer base, which is spread throughout its 16-state territory. Previously Fios in these states, such as Delaware, Maryland, and Virginia, topped out at 30Mbps/15Mbps and 15Mbps/15Mbps.

Verizon will also upgrade its mid-tier offering increasing speeds from 15Mbps/2Mbps to 20Mbps/5Mbps. And the low-end service will increase from 5Mbps/2Mbps to 10Mbps/2Mbps.

As cable and phone companies slug it out in markets across the U.S., improving customer care is becoming a core part of their strategies.

For the past few years, cable and phone companies have been neck and neck in many markets. Cable companies have introduced new phone services to compete with phone companies, and phone companies have started offering competing TV services.

On the broadband front, cable and phone companies now offer similar speeds in feeds in many markets. While cable has historically been priced slightly higher than services offered from phone companies, these too are evening out in many markets with various promotional service offerings.

Now, more than ever, consumers seem to be influenced by their perception of a particular company and their own experience with customer care. What's more, the Internet has changed things. It used to be that a single disgruntled customer would influence only a few friends and neighbors. But with the advent of blogs and forums all over the Web, unhappy consumers can find a much wider audience, potentially reaching thousands or even millions.

"Customers are making choices every day," said Rick Germano, senior vice president of Customer Operations for Comcast. "They are trying to figure out which company to go with to get TV, high-speed Internet service, and now phone service. And their perception of who is offering those services is a big driver in who they choose."

Unfortunately for Comcast, its customer service has taken a beating recently. Just last month, the company got the lowest score it's ever gotten on the American Consumer Satisfaction Index, a major customer satisfaction study conducted by the University of Michigan. And last week, it ranked as the second worst company in terms of customer care in an MSN Money customer survey.

These results follow publicized tales of a technician sleeping while on the job and a hammer-wielding grandmother going crazy due to poor service. And it also follows accusations that the company throttled BitTorrent peer-to-peer traffic.

Germano acknowledged the company needs to improve its service and perception.

"Comcast takes full responsibility for what these surveys are saying," he said. "We don't disagree with the results. And we're listening. We get it. But we look at this an opportunity for us to improve. As a business we have to do it."

Comcast's main competitors, AT&T and Verizon Communications, have faired better in these surveys than Comcast. But that doesn't mean that there aren't pockets of dissatisfied customers.

In fact, my sister who recently moved to a suburb near Boston chose to get her Internet and TV service from Comcast even though Verizon's new Fios service was available in her town. Why? The reason was simple. The Verizon technician who was scheduled to set up her basic phone service didn't show up twice for his appointment.

"I knew from the phone incident that there was no way I was going to get Verizon's Fios service, no matter how good or fast the service was supposed to be," she said.

My sister isn't the only dissatisfied Verizon customer I've heard from. Several readers have sent e-mails and commented on the "Talk Back" of some of my blogs saying they have had similarly bad experiences when trying to get Fios service installed. Verizon executives acknowledge the company has experienced some growing pains, especially as it rolls out its new Fios service. But Tom Maguire, the company's customer service czar, says the company is making improvements.

"I don't think anyone wants to be known for providing terrible customer service," he said. "Everyone wants to do the right thing for the customer. So we have to figure out how to remove obstacles that are preventing us from delivering great customer service every time. If we can't deliver the best product with the best service, the customer will go somewhere else."

Winning customers over
So what are these companies doing to improve?

Comcast has hired 15,000 new customer service agents and technicians over the past 18 months to help the company answer calls and provide service to customers. It has also rolled out new high-tech diagnostic tools for agents in the field and at call centers to help better assess problems. Comcast has also started re-dispatching field technicians if it looks like a certain technician may not be able to get to his next appointment.

Customer service agents are also starting to work on Saturdays and Sundays to schedule and serve customers when it's most convenient for them. And it's offering real time online chat services so that customers can talk live with a customer account executive.

Germano said the company is trying to listen to customers more, and that includes establishing a special team within the company to follow blogs, like the Consumerist.com and online forums where many problems are often reported by customers.

Verizon's Maguire said that his company is doing something similar. Like Comcast, Verizon has a team that monitors blogs. And Maguire himself often answers e-mails from customers with complaints as part of what the company calls a "you touch it, you own it" philosophy.

The phone company is also starting to roll out a new text-messaging system that automatically alerts customers when a technician has been dispatched to a location. It will alert customers if the technician is running late.

In addition, Verizon has made big improvements in its customer care centers. One major change is that it has been staffing the fiber solutions centers, which handle technical issues with the fiber-to-the-home Fios service, with customer care representatives who can resolve billing and enrollment issues.

"It's more cost effective and better marketing to take care of the customers you already have than to go out and try to acquire new customers."

--Tom Maguire, Verizon's customer service czar

Verizon also has improved its voice response system to help customers resolve certain issues on their own. And it's given customers who would rather reach a human representative a way to navigate out of the voice response system.

It's implemented a new queue-busting system that monitors the flow of calls into call centers. If a center is getting overloaded with calls, more representatives are added dynamically to handle the overflow calls.

"Our goal is to make it easier for customers to do business with us," Maguire said. "It's more cost effective and better marketing to take care of the customers you already have than to go out and try to acquire new customers. And the magic formula for doing this is really the golden rule. Treat customers how you want to be treated."

Another major trend that seems to be filtering into every major broadband provider is a greater focus on standardizing processes. While local branch offices will continue to handle local service calls and dispatch technicians directly to customers, bigger service providers, such as Comcast, Verizon, and Time Warner Cable, say that it's important to make sure that best practices are shared throughout the company.

"If someone calls with a problem, chances are good that they are talking to someone in their town," said Alex Dudley, a spokesman for Time Warner Cable. "But they will still have the big company experience in that we are sharing what we've learned from our 150 million calls a year to implement best practices that can be shared across the company."

Maguire, who took over as Verizon's head of customer care late last year, said he's already started seeing an improvement.

"Improving customer service is a journey that really has no end point," he said. "We're always striving to do better. But I do think things have gotten better. One indication is there are a lot fewer calls that get escalated to my level than there were when I started."

On Tuesday, the Franchise and Concession Review Committee (FCRC) of New York voted unanimously to approve Verizon's proposal to provide Fios TV service in all five boroughs. The vote moves the service closer to becoming an option for customers in New York to choose over cable or satellite TV.

"If we are successful in the last steps of the approval process, we will deliver on our promise to begin offering Fios TV in parts of each of the five boroughs later this year," Monica Azare, Verizon senior vice president for New York and Connecticut, said in a press release. ... Read more

Verizon Communications' hot streak continued during the first quarter of 2008.

The company said Monday that first quarter profits jumped about 10 percent to $1.64 billion, fueled by demand for its mobile phone service and fiber-to-the-home service called Fios.

Revenues grew about 5.5 percent to $23.8 billion, the company said. About $11.7 billion of that revenue came from its wireless business, an increase of about 13.2 percent from the first quarter of 2007.

There's no question that Verizon Wireless, which is jointly owned by Vodafone, has a good reputation as a wireless provider. Its network is considered to be highly reliable, and the company has always done well retaining customers.

And now Verizon is getting those customers to use more of its data services, such as picture messaging, text messaging and Internet surfing. In fact, it looks like mobile data is driving growth in the highly profitable wireless business with revenue from data services jumping 48.9 percent from the previous year generating about $2.3 billion in revenue.

Verizon reported that its customers sent or received more than 58 billion text messages and 1.1 billion picture/video messages during the quarter. And customers completed 34.6 million music and video downloads. On average, Verizon's wireless customers spent $11.94 a month on data services, an increase of about 33 percent from a year earlier.

Mobile data accounted for about 20 percent of all wireless sales for the quarter, but the company hopes it will eventually account for a bigger chunk of the revenue pie in the future. About 58 percent of Verizon's retail customers had broadband capable devices at the end of the first quarter, the company said.

Wireless operators, such as Verizon, are counting on consumers to use even more data in the future. That's the reason Verizon spent $9.3 billion on new wireless spectrum licenses in the Federal Communications Commission's recent 700MHz spectrum auction. The company has already said that it plans to use this spectrum to build its 4G wireless broadband network that will deliver even faster data speeds to its customers using a technology called LTE.

The company is also trying to spur innovation by opening its network to a faster certification process for new devices and applications. The hope is that streamlining the process will allow developers to get products and services that use the Verizon network on the market faster than before offering customers new and cool devices and applications first.

But wireless isn't the only shining light for Verizon. The company also saw big growth in its fiber-to-the-home service called Fios. This service, which includes high-speed broadband access, telephony and TV service, competes head-to-head with cable offerings. Verizon said it added 263,000 new TV customers in the first quarter bringing the total number of Fios TV customers to 1.2 million. In terms of broadband, the company said the majority of its new broadband customers were for Fios. The company added 262,000 Fios broadband connections during the quarter for a total of 1.8 million Fios broadband customers.

As expected, Verizon continued to see declines in its traditional telephony business, which fell 2.5 percent during the quarter. The company cut about 6,500 workers in 2007 and more job cuts in the traditional telephony business are expected throughout the year, company CFO Doreen Toben said.

Verizon's bets on wireless and fiber seem to be paying off. But as the overall U.S. economy softens it will be interesting to see if the company's strong growth will continue. My gut feeling is that Verizon is in good shape. Cell phone, TV, and broadband service are three things that most people won't want to live without even if they are crunched for cash. But the big question is how much more will people be willing to spend on the extras, such as mobile music downloads, mobile TV service or the highest level TV and broadband packages? That's the big question that will likely determine how much growth Verizon will experience in the future.

Verizon is running an ad implying that CNET gave its Fios TV service's picture quality a positive review, calling it "near-flawless." The reality is that a CNET Networks property did use that phrasing in a news story, not a review, and the words are taken out of context.

Adding to the confusion, CNET itself bears some of the blame.

Here's the all-important context: a series of Fios TV spots running in the New York metropolitan area and possibly elsewhere uses a couple of words clipped from a June 21, 2007, CNET News.com piece on Verizon's Fios service. The commercial flashes a quote on the screen that says "near-flawless" along with the CNET logo, while a voiceover proclaims: "Your HDTV doesn't want cable. Give it Verizon Fios, for picture quality the experts call 'near-flawless.'" Another, more-recent ad is also running with a slightly expanded logo-backed quote that reads: "A near-flawless TV experience." Check out the video, which CNET uploaded to YouTube, for the original spot.

Those words did appear on a News.com story (News.com and CNET Reviews are sister sites published by CNET Networks). But the context of the original News.com piece, titled "Verizon's fiber-optic payoff," reads quite differently from how Verizon is using it:

... Read more

There's a good piece by Saul Hansell over on The New York Times' "Bits" blog.

Hansell describes how Comcast is being criticized for low picture quality on certain broadcasts. That's interesting, especially in light of the contention between Comcast and DirecTV on this very issue, but it isn't the most important point in Hansell's post.

Hansell goes on to give a reasonable explanation of the basic issues involved, and mentions the likely future of cable TV: digital video distributed over Internet-like network switches. Instead of always sending every TV channel to every house, a switched system sends only the data for the channels that are being watched. (While it's fair to say that the capacity of such a system has no arbitrary limits, it isn't "infinite" as Hansell said.)

But there is a big practical difference between a system with hundreds of channels and one with, at least potentially, millions. With switched video, every channel is "on demand"--and anything that customers demand can be made available. Imagine YouTube in true HD, for example. That's impossible today, but with switched video, it's merely expensive. :-)

I wrote about switched-video technology back in 2001 in my column for Electronic Business magazine, and honestly I thought this technology would be in use by now, at least in test markets.

Verizon's Fios service has most of the necessary characteristics, but even Fios carries video in pretty much the same way copper-based cable systems do, except using an optical carrier over fiber. (Wikipedia has a decent explanation here.)

Well, there's no hurry. We'll get there eventually.