Verizon has selected four vendors to provide the fiber-optic and electronic equipment for the company's deployment of fiber to the premises systems, which is slated to begin next year.
Advanced Fibre Communications Inc. has been tapped to provide the central office and premises optical electronics for the project, also known as the "active" elements of FTTP technology. In addition, Verizon has selected Sumitomo Electric Lightwave, Pirelli Communications Cables and Systems North America, and Fiber Optic Network Solutions (FONS) to provide the fiber-optic cabling and other outside plant equipment for the project. This equipment is also known as the "passive" element of the project. Verizon is continuing contract negotiations with several other passive element vendors.
In a speech at a UBS global communications conference, Verizon Vice Chairman and Domestic Telecom President Lawrence T. Babbio Jr. said the vendor selection completes the second major phase of the project, begun earlier this year when Verizon, BellSouth and SBC adopted technical standards and issued a joint request for proposals to equipment suppliers.
"Our customers are telling us they want faster speeds and more data-transfer capacity; this technology is capable of transferring data at speeds up to 622 megabits per second to the user and 155 megabits per second to the network -- far faster than cable modems or today's DSL," Babbio said. "We believe our deployment of this technology will have widespread benefits throughout the economy of our nation by stimulating products that can only be delivered over this platform."
Babbio said Verizon will invest in FTTP next year without an increase in its historical capital spending levels. Verizon's capital investment plans will begin to shift from deploying copper to building a network based on FTTP technology. The company expects to realize some ongoing expense savings through reduced maintenance costs once the technology is deployed.
Verizon's initial deployment plans involve passing about 1 million homes with the new technology in 2004, with the deployment pace potentially doubling in 2005.
The company will install the new technology in two ways: directly connecting existing homes and businesses to the company's network as they order services that use the new technology, and installing fiber-optic lines to many new residential developments and business premises as they are being built.
"As we continue to move ahead, it is important to stress that the Federal Communications Commission (FCC) must further clarify the rules it recently released," Babbio added. "It is imperative, for example, that we receive assurances that we will not be forced to share our investment in this new technology with our competitors, as is the case with copper facilities today. This sort of regulation will only serve to deter our investment in these new technologies."
Verizon will continue performing lab and technology interoperability tests on the FTTP systems during the fourth quarter of this year, ensuring the new technology works properly with existing and new Verizon operations support systems. In the first half of 2004, Verizon expects to begin initial test deployments in at least two communities. By the end of the year, the company expects to deploy the new technology in more than 100 central offices across nine states.
