CES 2008

Verizon Gets 2008 Off to a Fast Start with Launch of 15 Mbps and 20 Mbps Symmetrical FiOS for Business Tiers

| Jan 8, 2008 | Business Network Services - U.S. | Show Update

| Analyst: Cindy Whelan

Current Perspective: Positive
Vendor Importance: High
Market Impact: Moderate

Event Summary

January 7, 2008 – Verizon announces availability of high-speed symmetrical FiOS Internet for Business service. Small and medium businesses in Verizon markets across 18 states now have the option of 15 Mbps or 20 Mbps symmetrical service with either dynamic or static IP addresses for monthly prices starting at $99.99 and $139.99, respectively. FiOS Internet service is available as part of a voice bundle or as a stand alone Internet access service, and includes free installation for one computer, 24x7 business-class technical support, 20 MB of web space and unlimited remote dial-up access for employees on the road. Verizon has also revamped its pricing structure for its high speed Internet plans, lowering prices by as much as 35%.

Analytical Summary

• Current Perspective: Positive on Verizon’s announcement that it has extended its 15 Mbps and 20 Mbps symmetrical Verizon FiOS Internet service to businesses in all Verizon FiOS markets across 18 states because the availability of the symmetrical tiers will give businesses with data-intensive requirements (such as transferring video and image files) a service option that far exceeds the uplink speed of offers from competing providers. The lower prices for Verizon's asymmetrical FiOS business tiers will have a broad appeal across its base of current and potential customers.

• Vendor Importance: High to Verizon because the availability of 15 Mbps and 20 Mbps symmetrical FiOS for Business service tiers surpasses broadband speeds presently available from cable operators and other competitors, giving Verizon a very strong marketing and technology differentiator. While DOCSIS 3.0 will offer the cable operators the ability to increase their cable broadband speeds, these upgrades are not expected to reach critical mass within most cable operators’ networks much before the end of 2008, giving Verizon ample time to attract business users with its new FiOS for Business service tiers and prices.

• Market Impact: Moderate on the small business services market because availability of symmetrical FiOS for Business service will be very attractive to businesses with data-intensive needs that are currently using lower speed cable or DSL services within the FiOS footprint. But this is a relatively small subset of the SMB market and FiOS availability is still limited. Symmetrical services are not new to the business market, but previous DSL-based offers (excluding higher-end services based on bonded DSL) supported a maximum speed of 1.5 Mbps. Verizon’s leap to 15 Mbps and 20 Mbps symmetrical service along with asymmetrical service options of up to 50 Mbps/20 Mbps and up to 30 Mbps/15 Mbps (depending upon the market served) gives business customers that are within a FiOS service area the opportunity to significantly increase their connection speeds.

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Current Perspective

Competitive Positives and Concerns

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