Verizon Wins Approval to Sell Cable in Fairfax County
Tuesday, September 27, 2005
Verizon Communications Inc. won approval last night to sell cable television in Fairfax County, an important step in the company's drive to consolidate telephone, Internet and television service into one package.
After a public hearing, the county Board of Supervisors voted unanimously in favor of granting a non-exclusive, 15-year franchise agreement to Verizon.
"The board has been trying for many years to bring competition to Fairfax County. We are now at a point where the technology has caught up to our desire to bring this competition to our citizens," said Gail Condrick, director of the county's cable office.
For Verizon, the franchise agreement marks its first foray into selling television service in a major metropolitan market, with an affluent and ethnically diverse population of more than 1 million residents.
"It's a bellwether for us," said Harry J. Mitchell, a Verizon spokesman. "It's the largest franchise we've gotten to date. We hope this can serve as a catalyst for similar results elsewhere."
The company also has franchise agreements pending before Loudoun and Arlington counties, Leesburg, and Fairfax City and is in negotiations with Howard County and the city of Bowie in Maryland.
Verizon has been moving aggressively to enter the cable market as part of an industry-wide trend to bundle voice, high-speed Internet and video services. Just as the phone giant is entering the television business, cable companies such as Comcast Corp. have begun offering telephone service over the Internet.
Cox Communications Inc. is the major cable provider in Fairfax, with 242,000 customers. Comcast has about 18,000 customers in Reston.
Verizon said it could begin selling cable in Fairfax County by early next year but has not set prices yet. The company launched its Fios TV service this month in Keller, Tex., where it charges $39.95 per month for a 180-channel package.
The company recently signed agreements with the Walt Disney Co., which added ESPN as well as other popular channels that had been missing from the Fios lineup.
Although its video service remains largely untested in the commercial market, the company has secured cable franchises in six towns in California, Texas and Florida, as well as in Herndon and at the Marine Corps base at Quantico.
The company has been laying groundwork for its entry into the Northern Virginia cable market for some time, installing fiber-optic lines in select Fairfax County neighborhoods since March 2004.
The conversion to fiber optics has angered some Fairfax residents, who have complained that underground digging near utility lines has caused service outages and other damage. The county's consumer-protection agency has received 166 complaints since last September about property damage attributed to Verizon -- complaints echoed before government agencies in Montgomery and Prince George's counties, as well.
"We are very concerned about the impact their construction has had on our customers," said Gary McCollum, Northern Virginia vice president and general manager for Cox Communications, during testimony before last night's vote.
Some supervisors expressed concern about Verizon's customer service and construction practices. But among the public speakers at a hearing before the vote, there was no opposition to granting the company a franchise. Several of those who spoke identified themselves as Verizon employees.
The potential for competition in the cable market, however, overrode any concerns about Verizon and has been on the county's agenda for several years. In 2001, the Board of Supervisors revised the Fairfax County Code to encourage competition in the cable market, and it hopes the head-to-head rivalry with incumbent cable and satellite providers will decrease cable prices by as much as 15 percent.
A report by the Federal Communications Commission said less than 4 percent of communities nationwide have effective competition in the cable market.
"I think for our citizens, competition is at hand," said Board Chairman Gerald E. Connolly (D).