Philadelphia residents could see some real pay-TV and high-speed Internet competition.
Verizon Communications Inc. said today that it has negotiated a deal with the city to offer FiOS in Philadelphia, a market dominated by cable giant Comcast Corp., which is headquartered here.
City Councilman Darrell Clarke introduced a bill today to award a 15-year cable franchise to Verizon. He introduced the bill on behalf of Mayor Nutter, who took office in January. The measure faces hearings and Council approval.
Verizon says that it could offer city residents FiOS TV service within a few years of being granted a video franchise.
FiOS TV carries the Comcast SportsNet channel, which has rights to Phillies, Flyers and Sixers games. Satellite provider DirecTV, the nation's No. 2 pay-TV company, does not have Comcast SportsNet in Philadelphia, a bone of contention for city sports fans who say they are forced into Comcast.
Comcast spokesman Jeff Alexander said, "Competition is nothing new for us. Verizon is typically the fourth or fifth entrant in a market. We continue to compete every day on every level of our business."
Comcast would innovate new products and won't be distracted by something the "phone company may or may not do in coming years," he said.
Verizon will offer the FiOS service to about one-third of Philadelphia residents within three years of city government's approval of a video franchise, the company says.
FiOS includes high-speed Internet.
The initial service area will include parts of West, North and South Philadelphia, Germantown and the Greater Northeast, the company said.
Verizon has faced criticism that it has launched FiOS mostly in wealthier towns and neighborhoods. As of February, the service was available in 182 towns in the Philadelphia suburbs.
The franchise agreement sets aside 15 public, educational and government-access access channels for Philadelphia, or its Public Access Corp.; payment of franchise fees equivalent to 5 percent of gross revenues on pay-TV service; financial support for public-service channels; and four service centers.
Verizon said that it approached the city in April and negotiations began in June.
"Philadelphia residents for too long have suffered from a lack of choice for their cable TV news, information and entertainment," Gale Y. Given, president of Verizon Pennsylvania, said in a statement today. "We will change that in a big way, with a significant investment over the next seven years."
The telephone giant has spent billions building a fiber-optic network for its FiOS service and offers it throughout the Philadelphia suburbs.