Verizon Awaits Decision on D.C. TV Franchise Future

Verizon Communications Inc. (VZ) announced that it’s in the final stages of landing a TV franchise for its FiOS service in the heavily populated District of Columbia, that includes a number of requirements the telco has agreed to meet.

A franchise agreement between the D.C. Office of Cable Television (OCT) and Verizon Washington, D.C., has been drawn up and is now being considered with a vote on the telco TV provider’s request expected by yearend.

The Council of the District of Columbia now will consider the agreement and subsequently vote on whether to approve it. The legislation, which was introduced at the request of D.C. Mayor Adrian Fenty, was referred to the Committee on Public Services and Consumer Affairs.

“Verizon and OCT over the past 10 months negotiated a franchise agreement that ensures Verizon's deployment will touch on each of the District's eight wards over the next six years,” OCT Director Eric E. Richardson said, in prepared comments. “The agreement also includes support for public, educational and governmental access channels and strong customer-service standards.”

Subject to franchise approval by year-end, Verizon says it plans to begin designing and upgrading its network in the District to all fiber optics and could begin offering its fiber optic-based FiOS TV service in the District within about a year.

The review, according to one council member, should be completed by the end of this year.

The news comes just weeks after Verizon was granted a TV franchise for New York City, which because of its size, density and urban environment will present big opportunities and challenges for the telco TV provider, including technical issues and heavily entrenched cable operators.

With the 15-year D.C. agreement, Verizon will ─ within three years of the agreement's effective date ─ offer service to all residences in an initial service area served by three Verizon switching offices in the District's northwest and southeast quadrants.

Within six years, Verizon will expand its services to an extended service area that will include three more switching offices in the northeast, northwest and southwest quadrants.

Other franchise agreement commitments include nine initial public, educational and governmental access channels, with a provision for up to five more.

Verizon will pay franchise fees equivalent to 5 percent of gross revenues on cable TV service. The deal also includes financial support for the District's PEG channels and institutional network equivalent initially to 3 percent of gross revenues on cable TV service.

The Committee on Public Services and Consumer Affairs plans to hold a public hearing on the franchise agreement before sending the legislation to the full Council for review and consideration.

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