Verizon, city reach deal on cable TV service
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Verizon is pledging a quick start to the roll-out of its FiOS-TV service within the city of Pittsburgh following a deal announced today that brings cable competition to the region's biggest municipality for the first time.
The deal must be approved by city council and the city's Cable Advisory Board, but if all goes well, "it won't be very long," said Verizon spokesman Lee Gierczynski, before the New York-based communications giant starts marketing TV to neighborhoods already wired for its fiber-optic Internet service.
That will bring more than Verizon's prices and channels -- $47 per month for 250 standard definition channels plus local high definition channels, or around $11 more for dozens more HD channels and 14 more sports stations -- according to Mr. Gierczynski. It will bring innovative options like the capability to program one's digital video recorder and parental controls by cell phone, network the TV with the home computer, and access Internet networking tools like Facebook and Twitter through the TV.
He suggested that city residents would start seeing innovation from multiple providers. "When people have choices, it forces all of the competitors in the market to start competing on more than price," he said.
For as long as cable TV has existed, city residents have had just one option -- currently Comcast, which has a 10-year agreement with the city that expires at the end of this year. City Information Systems Director Howard Stern said that since talks with Verizon are now done after about one year of communication and a month of intense activity, he and his team will turn their attention to renewing with Comcast, which should be much easier.
Mr. Stern said that Mayor Luke Ravenstahl "wanted competition in cable. . . . Let the games begin.
"The prices will come down," he predicted.
Verizon has six years to offer cable in every city neighborhood or face fines. It must be marketing TV in at least half of the city -- including economically diverse neighborhoods -- within three years. Areas that might be ready earliest include most of the North Side, some South Hills neighborhoods bordering suburbs, Downtown, and parts of Lawrenceville, according to a map Mr. Stern showed the Post-Gazette.
FiOS Internet service is already available in parts of Banksville, Beechview, Bloomfield, Brookline, Carrick, East Hills, East Liberty, Friendship, Garfield, Highland Park, Homewood, Larimer, Lincoln-Lemington, Morningside, Overbrook, Point Breeze, Regent Square, Stanton Heights and Swisshelm Park, and it would be relatively easy to add FiOS-TV there, said Mr. Gierczynski. The company has been pursuing a strategy of offering bundled phone, Internet and TV service to customers.
"My guess is Verizon will start offering services as early as August or September," Mr. Stern said.
In return for letting Verizon offer TV in the city, and allowing its use of city rights of way, the city gets 5 percent of the gross revenue, just as it gets from Comcast. Verizon will also provide dedicated fiber-optic lines between some city public safety facilities, $700,000 over five years to improve the city's in-house video hardware, and 52 cents from each monthly bill to go toward public, educational and governmental broadcasting.
Verizon will give the city five channels -- two for governmental use, and one for public access PCTV, much as the city gets from Comcast, plus another on which public and private schools can broadcast programming, and a fifth channel for which the use hasn't yet been determined.
First Published July 6, 2009 10:29 am