R.I. Green-Lights Verizon’s FiOS Service

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The Rhode Island Division of Public Utilities and Carriers granted a compliance-order certificate for Verizon Communications’ FiOS TV video service, the first stage in a three-stage franchising process.

The certificate was granted for planned video deployment in Coventry, East Greenwich, Exeter, North Kingstown, Warwick, West Greenwich and West Warwick.

In the state order, the company noted that the upgrade of its wire centers in those communities was to be completed by the end of 2006. Video activation was contingent on making the regional central offices video-capable.

Verizon has already launched FiOS Internet services in West Kingstown and Warwick, according to the company. It intends to eventually deploy video to 80,000 Rhode Island homes.

According to the public record on the application, incumbent operators, including Cox Communications and Full Channel TV, stated level-playing-field concerns on the application during hearings throughout the year. Incumbents were concerned over Verizon requests for a waiver of the requirement to build a separate institutional network and to build production studios for public, educational and government programming.

Verizon argued that such requirements would be duplicative, with the costs passed through to consumers. Instead, the telco offered financial support for PEG channels that it asserted was commensurate with what the incumbents pay.

In lieu of institutional-network construction, the telco offered to provide access by institutions, schools and government buildings to its data service. Verizon will provide two levels of service: 5 megabits per second of data downstream and 2 mbps upstream, or 15 mbps downstream and 2 mbps upstream. Installation will be free, with one router provided per location and equipment grants available for qualified sites. But the data service itself will come with a charge of $39.95 per month for the slower speed or $59.95 per month for the faster speed.

The opposition became moot, however, when a state law was passed in 2006, assigning responsibility for PEG studios and operation to a third party. Providers will contribute to the state PEG entity on a competitively neutral basis. Relief from institutional-network demands was been extended to incumbent providers.

The state ordered Verizon to pay PEG equipment and operational support of $360,000, upon award of the certificate; and another $249,118 in one year.

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