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Verizon Pursues Multifamily Targets

Verizon Communications Inc. is making a major push to connect its FiOS fiber-optic network to the potentially lucrative — and often-overlooked — multifamily housing segment, with a new marketing campaign and a new brand name for the service.

The former Verizon Avenues unit, rebranded Verizon Enhanced Communities, is now busy replacing mostly copper telephone connections to apartment buildings and townhome communities with FiOS fiber-optic cabling.

The effort appears to be paying off: according to the company, in the past 16 months, the service has added more than 450 projects reaching almost 215,000 apartments, condos and co-ops, bringing its total to more than 1 million living units.

While a subset of the residential-service segment, multifamily housing represents more than 20% of the customer base in Verizon’s East Coast service area. In big cities, the percentage is even higher: in New York City, 32% of customers live in multifamily dwellings.

Figures from analyst firm In-Stat — a sister company to Multichannel News — estimate more than 5 million broadband multifamily customers in the United States, a figure expected to double to more than 10 million by 2009.

Connecting to these properties can be trickier than the average single-family house. Verizon pays to install the fiber-optic line, but because that work is on private property — rather than in a public right-of-way — it must negotiate access with building owners.

“We’re coming out 100% on our dime and overbuilding — we’re not asking the owner to fund any of it,” said Dan O’Connell, the Verizon Enhanced Communities national sales director. “If they give us the license to come in and build the network and the marketing agreement to come in and offer service and have a relationship, we’re going to build it out.”

In existing buildings, Verizon prefers to put the optical network terminal — the hub for each subscriber’s service — in the living unit. But in some cases, that can’t be done for space reasons, so terminals must be installed in a building basement or common area, with existing wiring such as Ethernet or coaxial cable used to deliver service to individual residences. That alternate connection technology is being readied for rollout this summer, O’Connell said.

O’Connell said Verizon, as a result of the FiOS multifamily campaign, is “seeing some very aggressive action and tactics on the part of the cable companies to try to lock in the business before we get there.”