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from: Boston Business Journal

Verizon Wants Filings Kept From Public

Todd, Wallack, Boston Business Journal
March 30, 2007

Over the last 14 months, Verizon Communications Inc. has launched TV service in 39 cities and towns across Massachusetts and won approval to enter four more.

But the phone giant doesn't want anyone to know how many customers have signed up for the service.

Verizon (NYSE: VZ) has asked the state Department of Telecommunications and Energy to seal documents showing how many TV subscribers it has in the state, even though the data has been public for other cable TV operators for years.

"Our competitors would love to know how we are doing and where we are going next,'' said Verizon spokesman Philip Santoro.

But rival cable operators are fighting the request.
"It's unusual, to say the least,'' said Paul Cianelli, president of New England Cable & Telecommunications Association Inc., which represents Comcast Corp. and most other cable TV operators in the state. "It's customary to have these numbers readily available."

Cianelli's group contends the data is hardly a trade secret, because Comcast and other competitors can already tell how Verizon is faring in other ways, such as monitoring cancellations and Verizon's marketing efforts. Instead, Cianelli and other industry officials speculated Verizon might be trying to hide a high complaint rate or disappointing subscriber numbers from the public.

"I don't think it's to keep Comcast from getting a competitive advantage,'' said Tom Steel, a spokesman for RCN Corp., which competes with Comcast in 16 communities in the state.

Verizon has been more forthcoming nationally. In January, the company said it had 207,000 TV customers in the United States at year-end, or about 9 percent of homes where the service is available. If Verizon has a similar penetration rate in Massachusetts, it would have about 18,000 customers in the state, or less than 1 percent of the cable TV market.

Ian Olgeirson, an analyst with Kagan Research LLC, said Verizon's national performance isn't bad, considering Verizon only jumped into the TV market recently. But he noted the company will have to sign up significantly more customers over the next few years to recoup its enormous investment of building a new fiber network.

The company has announced plans to spend $23 billion by 2010, enabling it to offer TV and faster Internet service to 18 million homes. It already has invested roughly $600 million in the fiber network in Massachusetts alone, said Verizon's Joe Zukowski.

Overall, the cable trade association estimates that about 60 percent of Massachusetts residents have cable TV, another 20 percent to 25 percent have satellite dishes and the rest rely on free broadcast television. Comcast, the nation's largest cable operator, has about 1.6 million customers in Massachusetts, or more than three in four cable TV subscribers in the state. So far, Comcast (Nasdaq: CMCSA) spokesman Jim Hughes says the company has maintained its market share, despite Verizon's marketing efforts. Meanwhile, Comcast is trying to go head to head with Verizon in the phone market, demonstrating how the cable and phone markets are starting to merge.

A spokesman for the Department of Telecommunications and Energy said the agency is considering Verizon's request for confidentiality but has no timetable for a decision.