Verizon Fios

Early development (1995–1996)

The early stages of Fios began when Bell Atlantic was testing its video service "Stargazer" in 1995. This was the world's first commercial VOD (Video on Demand) service, which was tested to 1,000 homes in northern VA. During this time there were talks of developing a fiber optic based service. This service was developed at a headquarters located in Reston, Virginia.

"This will be folded into our deployment of fiber to the curb," Mr. Townsend said, referring to Bell Atlantic's plans to deploy a high-tech fiber-optic system.

(Bloomberg 1993) (Baltimore Sun 1996)

Launch and expansion (2005–2010)

In September 2005, Verizon Communications, announced the launch of its Fios television service, which first became available for 9,000 customers in Keller, Texas. Verizon aimed to replace copper wires with optical fibers, which would allow greater speed and quality of communication.

In 2006, Verizon and Motorola partnered to bring its customers home DVR access, which allowed viewers to record and watch television programs simultaneously. In 2006, The Wall Street Journal speculated:

Verizon Communications Inc. is fielding offers for [sale] ... of traditional telephone lines ... part of the New York-based phone giant's strategy to delve deeper into the wireless and broadband arenas, while getting out of the traditional phone business in U.S. areas that aren't slated for fiber upgrades ... Verizon also has been shopping a package dubbed "GTE North" that comprises about 3.4 million access lines in former GTE Corp. territories in Indiana, Illinois, Ohio and Michigan.

In addition to expanding its customer base, Verizon expanded its services in the first few years. Home Media DVR, a digital video recorder, was released in 2006. Fios updated its user interface in 2007, allowing customers to access widgets for localized content, such as weather and traffic. Verizon announced in January 2008 that one million people subscribed to the service. By the end of 2008, Fios offered more than 150 HD channels. Price increases were announced in April 2008, when Fios was available to (not necessarily subscribed by) 6.5 million households.

In January 2009, Fios was available to 12.7 million homes, with about 2.5 million subscribing to the Internet service. As of June 2009, Fios Internet had 3.1 million customers. Estimates on December 31, 2009, were 3.4 million Internet customers and 2.86 million for Fios TV, with availability down to 12.2 million premises.

Stable footprint (2010–present)

Following relatively poor financial results for the wider company in early 2010, Verizon announced in March 2010 that it was winding down its Fios expansion, concentrating on completing its network in areas that already had Fios franchises but were not deploying to new areas, which included the cities of Baltimore and Boston, which had not yet secured municipal franchise agreements. Doug Michelson, an analyst at Deutsche Bank, concluded that "Verizon has been overspending to acquire Fios customers". Some viewed the halt in expansion as a violation of Verizon's agreements with some municipalities and states, since Verizon has collected revenue to deploy infrastructure upgrades that never occurred. In New Jersey, Verizon collected an additional $15 billion in fees from customers and tax subsidies in exchange for promising fiber optic broadband for the whole state. The New Jersey government altered the deal in 2014 to allow Verizon to substitute wireless internet access to fulfill its promise instead. Verizon defended itself, claiming that they had spent $13 billion building fiber optics in New Jersey, about $7.6 billion more than the company anticipated. Critics pointed out that wireless internet was slower and less reliable.

In April 2010, Verizon announced that three million people were subscribed to Verizon Fios. In July 2010, estimates were 3.8 million Fios Internet subscribers and 3.2 million TV subscribers, with availability to 15 million homes.

In May 2013, Verizon announced it had passed 18 million homes with Fios and 5 million customers.

In April 2015, Verizon announced that it added 133,000 new Fios Internet connections and 90,000 net new Fios Video connections in Q1, taking its total subscriber base to 6.75 million and 5.74 million, respectively.

Technology

As described in 2007, Verizon Fios services are delivered over a fiber-to-the-premises network using passive optical network technology. Voice, video, and data travel over three wavelengths in the infrared spectrum. Service is distributed by single-mode optical fiber that extends from an optical line terminal at a Fios central office to the neighborhood where a passive optical splitter fans out the same signal to up to 32 fibers, thus serving up to 32 subscribers. At the subscriber premises, an optical network terminal (ONT) converts signals to the corresponding in-home copper wiring for telephone, television, and Internet access. Some Fios installations use an Ethernet cable for data and coaxial cable for television, while others use the Multimedia over Coax Alliance (MoCA) protocol for both data and television over a single coaxial cable. Telephone service is provided over existing cabling in the premises.

One of the three wavelength bands is devoted to carrying television channels using standard QAM cable television technology. The other two wavelengths are devoted to all other data, one for outbound and the other for inbound data. This includes video on demand, telephone and Internet data.

This allocation of wavelengths adheres to the ITU-T G.983 standard, also known as an ATM passive optical network (APON). Verizon initially installed slower BPONs but now only installs GPONs specified in the ITU-T G.984 standard. These bands and speeds are:

The set-top box (STB) receives IR code and channel subscription information through the out-of-band (OOB) channel, like other coax or RF-based STB. However, guide data, cover art, widgets and other data are sent via IP over the data channels. All upstream OOB requests (or responses) are sent via IP over the data channels. All non-OOB data transactions to or from STB's are carried over the MoCA channels. The MoCA channel is also used to carry out inter-STB transactions, such as multi-room DVR and synchronization.

Fios is also compatible with CableCARD technology allowing Fios TV subscribers to receive encrypted and premium cable channels on CableCARD-capable devices.

Video service

Verizon's broadcast video service is not IPTV (Internet Protocol television), unlike AT&T's U-verse product and CenturyLink's Prism product. However, video on demand content and interactive features, such as widgets and programming guide data, are delivered using IPTV-based technology. The majority of content is provided over a standard broadcast video signal that carries digital QAM content up to 870 MHz. The QAM system is identical to HFC cable TV, but is only one-way, and is not interactive, with no VOD or SDV content going over the QAM (VOD and SDV go over out of band IP). The 870 MHz QAM system was primarily done to satisfy franchise agreements that required a basic channel packaged with unencrypted, no STB required/cable-ready TV, channels. This broadcast content originates from a Super Head-End, which sends the signal to a Video Hub Office for distribution to Fios TV customers.

From the Optical Network Terminal (ONT) at the subscriber premises, the RF video is typically delivered with a coaxial connection to a Fios set-top box that handles both RF and IPTV video. Interactive services such as VOD and widgets are delivered by IP and are only accessible through use of a Fios set-top box and a Verizon-supplied router. The router supports multimedia (MOCA) and provides the set-top boxes with programming guides and all SD channels, but high definition content (beyond local HD channels which are in clear QAM) requires HD equipment like a Fios HD set-top box/DVR or a CableCARD-supporting device, such as TiVo. In 2008, Verizon ceased carrying analog television signals in parallel with digital channels, meaning televisions without a QAM tuner or a set-top digital adapter received no signal.

Fios TV Plans include:

Fios Spanish TV Plans include:

Quantum TV

In early January 2013, Verizon introduced Quantum TV service, to help expand the functionality of the conventional set-top box offered by Verizon Fios. The VMS can also record up to twelve TV shows at the same time, and it allows the customer to pause and rewind live TV. It also has up to one terabyte of internal storage which equates to 100 hours of HD content.

The older Quantum boxes have Motorola branding on them, but the newer Quantum boxes have Arris branding on them, as a result of Arris' acquisition of Motorola's Home business.

Internet access

Fios Internet was the first service offered under Verizon's Fios brand, and is one of three of the product line's current offerings. The broadband internet service initially launched in Keller, Texas, in 2004, a year before Fios TV was available.

The service offers several data transmission speed tiers for subscribers. Originally, peak speeds topped out at 30 Mbit/s. Until 2014, upload speeds were slower than download speeds for any given plan, but Verizon decided to increase the upload speed to match the download speed of each tier. As of 2016, upload and download speeds range from 50 to 500 Mbps, depending on the plan. At 50 Mbit/s, the lowest-tier plan is double the FCC's definition of broadband.

According to mid-year 2016 figures, there were 5.49 million Fios Internet subscribers at the end of Verizon's second quarter. Below are Verizon's present speed tiers (as of June 2016):

"Fios Instant Internet"

On January 14, 2017 Verizon introduced a new speed tier for residential and business customers: 750/750. This new speed is available for $149.99 (stand alone) or starting at $169.99 bundled (business pricing may be different) . This is available in most Fios markets except the Boston, MA and Norfolk, VA market which should be available later in the first quarter of 2017. (Verizon, 2017)

Traditional telephone service

As a component of its product line-up, Verizon also offers plain old telephone service (POTS). It has been reported in various markets that Verizon physically disconnected the copper lines, or the network interface device, for copper-line phone service at the time that Fios was installed, and that Verizon customer service talked customers into upgrading from copper with false promises of no changes in service rates.

Verizon sold landline operations in the markets of northern New England to FairPoint Communications in March 2008. Fiber to the premises projects in those markets was renamed as FAST (Fiber Access Speed Technology). In June 2010, Verizon sold landline operations scattered throughout 13 states to Frontier Communications. Some of these areas already had Fios service availability, for which Frontier became responsible. In 2015, Verizon sold Texas, California, and Florida landline and Fios operations to Frontier.

VoIP service

Fios Digital Voice is a voice over IP service that uses an ONT as the VoIP gateway, generating dial tone to enable traditional analog telephone service. The service began in September 2008. Fios Digital Voice replaced an earlier service, VoiceWing, which was launched in 2004 and discontinued in early 2009, shortly after the launch of Fios Digital Voice. It is the only telephone option for new Fios customers, and it offers an unlimited calling plan or $.05/minute plan. Fios Digital Voice has numerous international per minute calling plans as well.

Inside wire maintenance

Verizon offers the Inside Wire Maintenance Plan at a fee of a $9.99/month, which covers diagnostic and repair service for inside wiring and jacks. For Fios customers, it also covers jacks and wiring associated with Fios services.

Criticism

When Verizon Fios was first launched in 2005, Verizon's shares decreased by 4.6% while AT&T (which was still technically SBC at the time, as it was still finalizing its purchase of AT&T Corporation) rose by 38.7%. Critics argue that Verizon's low prices could put their fiber-optic network in jeopardy, since the cost of building a fiber-optic network could surpass the return from Fios sales. While there has been criticism of Verizon Fios since its launch, there have been many positive reviews of the services. A 2007 report noted the high quality of the service and that subscribers enjoy the fast Internet speeds and high quality HD channels.

The Weather Channel carriage dispute

On March 10, 2015 at midnight EDT, The Weather Channel and its sister network, Weatherscan, were pulled from Verizon Fios after the two parties were unable to come to terms on a new carriage agreement. The services have respectively been replaced by the AccuWeather Network (which launched on March 13) and a widget provided by Fios featuring forecast content provided by WeatherBug. No public announcement was made regarding the removal until over 12 hours after TWC and Weatherscan were pulled. The Weather Channel offered a less expensive deal to Verizon Fios, which rejected the offer. Verizon cited the wide availability of the internet and mobile apps for consumers to access weather content any time of day as the reason for dropping TWC and its services.

The Weather Channel had earlier signed renewal agreements with major providers that are members of the National Cable Television Cooperative (NCTC), including Time Warner Cable and Cox Communications. While Verizon claimed it was a long-term business decision (instead of a carriage dispute) that it made, The Weather Channel launched a campaign to urge viewers to contact Fios about restoring the cable channel and its services.

ESPN lawsuit

In April 2015, ESPN Inc. sued Verizon for breaching its carriage contract by offering ESPN and ESPN2 as part of a separate sports package under its new "Custom TV" service. ESPN's contract requires the two networks to be carried as part of the basic service. Verizon and ESPN reached a deal in May 2016. The terms of the deal were not made public.

Cablevision lawsuit

On May 19, 2015, Cablevision sued Verizon in U.S. District Court, Southern District of New York, to challenge Verizon's claim that it is 100% fiber-based. Cablevision started an advertising campaign to take the case mainstream. The two companies agreed to end the dispute in September 2015. The terms of the deal were not disclosed at the time.

Deployment issues

On March 13, 2017, Verizon was sued by the city of New York for violating its cable franchise agreement, which required the provider to pass a fiberoptic network "in underground conduit, along above-ground utility poles, or otherwise—in front of (or behind) each residential building" in the city by June 30, 2014. The city identified approximately 1 million households that were not yet served by the network, including a larger number of outstanding requests than claimed by Verizon, along with allegations that Verizon refused to install Fios in certain areas, and attempted to require multi-family residential units to enter into bulk purchases or exclusivity deals (which violates current FCC policy).

Verizon defended the accusations, stating that it could not install fiberoptic service at all households because they had not yet received permission from landlords. They added that the city did not assist them in drafting neutral letters to request access from landlords for installation, and rejected proposals to increase its use of telephone poles as part of its build-out of the network. The company stated that it planned to invest $1 billion to install Fios in 1 million additional homes, and small businesses, over the next four years. Verizon also stated that its obligation to "pass" all households was based on an understanding that the company would "generally place its fiber-optic network along the same routes as had been used for its copper network and would use similar strategies for accessing individual buildings", and that per these discussions, the agreement did not contain language defining "pass" as meaning that lines would be installed fronting buildings, unlike other cable franchise agreements.