Category Archives: Verizon Wireless

Verizon FiOS Growth and Verizon’s Streaming Video Service

Combined Verizon and AOL logos.

Analysts remain conflicted over the potential growth of Verizon FiOS as 2015 continues. New subscriber projections suggest there will only be around 90,000 additions during the second quarter, which are 25,000 fewer than had been anticipated. To put these totals in perspective, for the same period of time in 2014, FiOS subscribers increased by over 135,000. However, despite these underperforming totals, the expansion of Verizon FiOS, especially in parts of New York, Texas, and New Jersey, is expected to increase substantially over the next eighteenth months.

 

Even if FiOS numbers remain down, one of the reasons that observers are optimistic about Verizon’s financial growth over the long haul is that it plans to release its own video streaming service by September 2015. Over the past few months, Verizon has reached agreements with a number of content providers and is continuing talks with even more. While the initial target is to provide around 25 channels to subscribers, including content from Comedy Central, MTV, Food Network, HGTV, and the Travel Channel, the yet-unnamed service will also include video shorts produced by AwesomenessTV, a subsidiary of DreamWorks. While these offerings will whet the appetite of many consumers, Verizon has made clear that it is especially interested in a younger demographic. As a result of this focus, it has established agreements with ESPN, the ACC Network, CBS Sports, and 120 Sports. Content from these networks will include some NFL, college basketball, and college football games, but broadcast restrictions will apply.

 

Although complete details of the Over the Top (OTT) streaming service have not yet been announced, it is clear that Verizon plans to have an ad-based model, similar to what Hulu Plus does, compared to the pure subscription model used by Netflix. While Hulu Plus has not enjoyed the same subscriber growth as Netflix, Verizon hopes to change this by benefiting from its recent purchase of AOL. Since its days of providing users dial-up internet access, AOL has transformed itself into a leader in online advertising. Survey results produced by the advertising industry have shown that AOL is successful in reaching a target audience more than 55% of the time, a figure that is the envy of all advertisers besides Google. Another aspect tied to the success of the ads on the new Verizon service is that the company hopes users will enjoy the content not only at home, but also on their mobile devices. This means streaming over Verizon’s existing wireless network while consuming a lot of data. However, realizing that the threat of data overage fees may turn off some consumers, Verizon has established an agreement in which the advertisers will help subsidize part of the cost for data used while viewing video content.

 

Verizon backs down from throttling unlimited LTE users

Verizon announced their unlimited 4G LTE users would be hit with some throttling, or as they like to call it, “network optimization”, in order to make sure Verizon Wireless is maximizing profits.

After a rather large backlash from the Internet and an open letter from FCC’s Chairman Tom Wheeler, it looks like Verizon has backed down from the plans, announcing they will not continue.

 

The original announcement looked to stop grandfathered 4G LTE contracts, alongside users who use more than 4.75GB of data, from using the unlimited service without lower speeds.

This is the first time unlimited users, who pay more for the zero-cap data, would be hit with throttling. We are not sure how much these users were costing Verizon, but it must have been a tidy sum for them to try and impose these caps.

It is also the first time a wireless carrier has tried to use speed changes to dissuade people from owning legacy accounts or using more than the average customer, a tactic sometimes used by Comcast and other ISPs.

Sadly, Verizon has yet to learn that the Internet hates ISPs and wireless carriers and will rage at just about any change, especially when it affects both power users and people who pay an enormous amount to have large amounts of data.

Even with the withdrawal by Verizon, we doubt this is the last we will hear about caps and throttling. It is obvious Verizon wants users to have caps on their mobile usage and hit them with penalties for going over the caps.

The FCC has been a major force for good this time, instead of lazily brushing Verizon off and letting them make the rules on wireless contracts. This is good for consumers who want to own and continue owning legacy accounts with unlimited data.