IP Democracy: Verizon, Comcast to Go Head-to-Head in DC Market

Two of the top communications companies in the U.S. are about to provide a case study for future economists on the nature of facilities-based video competition. After suing Montgomery County, MD for onerous franchise conditions, Verizon finally got its cable franchise from the upscale DC suburban jurisdiction yesterday. Nearby Prince George’s County also issued a cable contract to Verizon, filling in some major franchise holes for the telco in a huge, tech-friendly and relatively well-to-do region that includes not only the District of Columbia, but also a spate of desirable territories including Fairfax, Anne Arundel, Loudoun, Prince William and Howard counties and Arlington, Bowie, Herndon, Leesburg and Laurel, all in Virginia.

Verizon now has the green light to offer its FiOS video services across all of these regions, which also happen to be prime Comcast Cable territory (with a smidgen of Time Warner thrown in). Bet on some interesting competitive developments in the year ahead as Verizon pits its turbo-charged set of voice-video-data services against Comcast’s triple-play bundles.

What’s really interesting is that this is one solid and expansive market that features basically two relatively well-matched competitors over a wide region. In most markets, Verizon might have a handful of franchises, while the cable company franchises typically represent a mix of operators, each with different competitive strategies, services and prices.

Verizon’s fiber-based FiOS video services are, arguably, the equal of Comcast’s video options, while the telco holds a slight competitive advantage over Comcast with its FiOS high-speed Internet access. Of course, Verizon also offers phone service — Comcast has recently rolled out and begun aggressively marketing its Comcast Digital Voice service in the region.

It’s going to be a true battle of the bundles in the DC metro region…stay tuned.

Posted by Cynthia Brumfield on November 29, 2006 4:40 PM to IP Democracy