Published June 2003

Verizon to grow DSL service, cut price

By Eric Fetters
Herald Business Writer

Verizon Communications will expand its high-speed Internet service in Snohomish County, even as the price of that service is being cut significantly.

The improvements and rate reductions for Verizon’s digital subscriber line service, known as DSL, are part of a national initiative announced in May.

“Verizon’s definitely putting a stake in the ground regarding broadband Internet service,” said Melissa Barran, a spokeswoman at the company’s regional headquarters in Everett. “This is just the beginning of a continuing effort to provide it to more customers, and provide it at a lower cost.”

In May, the price for standard DSL service fell from $49.95 and up to a flat $34.95 a month, Verizon said. Customers purchasing a Verizon package of local, regional and long-distance calling services began paying just $29.95 a month for DSL access.

For comparison, high-speed cable access to the Internet from Comcast Corp., the largest broadband provider in this area, costs $45.95, including the price of a rented cable modem.

Additionally, Verizon will add about two dozen remote DSL hubs across Snohomish County, expanding the local availability of the service. The maximum speed of the standard service also will increase for many customers, Barran said.

Verizon has about 1.8 million DSL subscribers across the country, according to the company. That’s out of 36 million households with Verizon phone lines equipped to handle DSL service. The national expansion will make the service available to another 10 million households by year’s end.

A recent study by Strategy Analytics, a Boston-based research firm, found 27 percent of households surfing the Internet were using broadband connections. That number is expected to grow to 70 percent or more in the next five years.

“We believe that broadband is poised and ready to move from its original market of early adopters to widespread acceptance by a mass market,” Lawrence Babbio, Verizon’s vice chairman, said in a conference call from New York. “To capitalize on this pent-up demand will require not only the best network and the best coverage, both of which we have, but also the best value of customers.”

While some analysts are predicting Verizon’s moves will spark a price war over broadband services, Comcast has not announced plans for a major price change. In some areas, the cable company is offering introductory specials that undercut Verizon’s new price.

Steve Burke, Comcast’s president, said he thinks cable Internet access remains a better product, as it tends to be available in a wider area and with comparable or faster speeds than DSL service.

The cable company, which has 3 million subscribers to its Internet service nationally, is in the middle of upgrading its own infrastructure in Snohomish County in order to expand the area where its high-speed Internet service is available.

Verizon also announced in May that it will make wireless connections to the Internet available at 1,000 pay phones in New York City. The company will make the wi-fi service available for free to its DSL subscribers. Barran said Verizon probably will extend its wi-fi service to other areas of the country in the coming years.

Related: Verizon earns raves for plans to cut costs, add service

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