Verizon to Mimic Unity’s Call

Call it a predictable move — during Verizon’s conference call today, Verizon said the company will unveil a wireless-wireline bundling plan Tuesday. vzlogo.jpg
While no details were offered, it will most likely be a stay-with-us plea that answers AT&T’s Unity offering of no-extra-cost calls between in-house wireless and wireline phone numbers. “We’re going to bundle wireless into the consumer plan — you’ll see [that] tomorrow,” said COO Dennis Strigl, during the Q&A period of the call. “Stay tuned.”

Like AT&T, Verizon needs to do all it can to retain customers as it slowly rolls out its costly advanced FiOS services. Even though Verizon’s overall numbers from Q4 beat analyst predictions, there’s no hiding the landline losses for the big telcos. Monday Verizon said it lost 366,000 landline customers during the past quarter, just more than 4,000 disconnects per day.

Despite rosy predictions about uptakes for FiOS Internet and TV services, Verizon itself knows that it can ill afford to lose current customers, since those are probably the hardest to win back. Strigl admitted as much in response to another analyst question, claiming that Big Red will have “a significant focus on retention of access lines in ’07.”

What will be interesting to watch Tuesday is how Verizon structures its wireless bundling plan, since unlike AT&T, Verizon does not own its wireless business outright but rather partners with Vodaphone.

The fiber-based FiOS, Verizon’s big moneymaker for the future, continues to add customers but it won’t be challenging cable anytime soon. While Verizon reported gains of an additional 89,000 FiOS TV subscribers during the quarter, its total of 207,000 TV customers is somewhat dwarfed by say, Comcast’s 24 million TV viewers. Verizon said Monday that it expects to pass another 3 million homes in 2007 with FiOS fiber; even at its current take rates (of around 9 percent, according to the company), that’s at best another 270,000 video customers by next year. Meanwhile, the company expects FiOS spending to dilute earnings by about 35 cents per share in 2007.

Strigl did add, however, that Verizon is doing all it can to make installation quicker and cheaper. “We’re really focused on eliminating wasted [installation] time in the home,” he said. So, you can waste time watching FiOS TV that much faster.