Verizon Looks at Extending FiOS Targets; Considers Rural Wireless Acquisitions

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Verizon Looks at Extending FiOS Targets; Considers Rural Wireless Acquisitions

1:26 pm on June 3, 2008 | Category: Business, Telecom Services, Telephone, Internet, Television, Wireless

America’s second largest telecommunications carrier, Verizon Communications, is considering expanding its FiOS broadband and TV network beyond an initial target of 18 million households, according to the company’s Chief Financial Officer, Doreen Toben.

“We are currently looking at — and we will in the middle of this year — more expansion,” Toben said. “We’re poking it a little bit now to say we think we could expand. So more to come on that.”

Verizon’s FiOS network now passes some 10 million homes, and generates around 25% of the company’s consumer revenue. The network currently serves 1.8 million broadband users and 1.2 million FiOS TV subscribers, with these figures expected to reach 6 million and 4 million, respectively, by 2010.

When asked about possible acquisitions in the wireless industry, Toben described the rural cellular market as fertile ground.

“There’s a lot of opportunity for consolidation there,” she said. “There are some smaller players. If the right thing came along, we’d take a look at it.”

In recent months, Verizon has pursued a strategy of acquiring new wireless assets (such as the cell phone business of SureWest Communications), while selling off parts of its core landline telephone business. Just last month, the company finalized a deal to spin off its wireline assets in the New England states of Maine, Vermont, and New Hampshire, and sell them to smaller rival, Fairpoint Communications.

According to Toben, however, Verizon isn’t planning to sell off any more wireline assets in the immediate future.

“The regulatory process with Fairpoint was exhaustive,” she said. “It took a very long time. So for right now, at current course and speed, I’d say we’re happy where we are. Not forever. But for right now, I don’t think we’re looking at more [spin-outs of rural lines].”