Wave Systems Corp. (fka WAVXQ)

[SPIN]

Verizon to Sell Video Over Fiber in 2005

Wasn't one of Wave's many former business models related to pay-per-view over fiber? Isn't it also more-or-less the primary model for the money losing indulgence of the WaveXcess subsidiary?

Funny, Verizon doesn't seem to know how "cool" their stuff could be if they would only let Wave through the door.

SO, did Wave sell *anything* today?

http://story.news.yahoo.com/news?tmpl=story&cid=569&ncid=738&e=2&u=/nm/20040519/tc_n...

Wed May 19, 3:56 PM ET

Add Technology - Reuters to My Yahoo!

By Justin Hyde

WASHINGTON (Reuters) - Verizon Communications Inc. (NYSE:VZ - news) will begin selling video over fiber optic lines to homes and businesses in 2005, part of a long-term strategy to fight cable companies on their own turf before they erode too much of Verizon's traditional telephone business.


While the first video services Verizon will offer will mimic those available from cable and satellite television services today, Verizon executives say the company will eventually move into higher-technology formats that could offer far more options to viewers.


"We have a huge opportunity," Paul Lacouture, Verizon's president of network services, told Reuters. Fiber optics "allows us to get beyond parity with cable and get to a video product that will be different from the traditional 150 channels on cable and satellite."


The largest U.S. local phone company outlined the plans as part of its strategy to spend $1 billion on laying the foundation for a fiber optic network connecting homes and businesses in nine states. The company has committed to making the new network available to one million homes and businesses by the end of the year, with another two million added next year.


Fiber optic cables use light to transmit data at far greater speeds than copper wires, but cost far more to install and only about 70,000 U.S. homes have such connections today. Verizon and other "Baby Bells" have long regarded networks built on fiber optic cables as the ultimate weapon to fight off challenges from cable companies and new competitors.


Verizon said it would launch its fiber optic service by offering voice and high-speed Internet connections, including one with download speeds of 30 megabits per second, about 10 times faster than the fastest cable high-speed links.


While those services will be available this year, Verizon executives said it would likely be the second half of 2005 before its video-over-fiber business was up and running. The company must get cable franchise licenses, as well as arrange agreements with cable networks.


Bob Ingalls, president of Verizon's retail marketing group, said while Verizon's first video services will look like cable, the fiber optics will allow it to expand to new services, such as wider numbers of high-definition channels.


Analysts contend "Baby Bells" such as Verizon must attack cable companies head-on as the cable industry begins to win more phone customers with Internet-based calling services.


"Video offers (phone companies) the potential for new revenue streams and an opportunity to stem customer losses," said Yankee Group analyst Aditya Kishore.