Verizon Completes Fiber-to-the-Premises Vendor Selections by Choosing Corning and Three Other Companies; Deployment and New Product Rollout Begin in 2004

NEW YORK - Verizon took another step forward in its plan to begin deploying fiber- to-the-premises (FTTP) systems next year by completing the selection of equipment manufacturers and suppliers for the project.

Verizon has already announced plans to begin deploying the high-speed, high-capacity FTTP systems to homes and businesses in 2004, leading to an array of new telecom products.

Verizon Network Services Group President Paul A. Lacouture said the latest vendor selection completes the second major phase of the project, begun earlier this year when Verizon, BellSouth and SBC adopted technical standards and issued a joint request for proposals to equipment suppliers.

The four vendors announced today will provide fiber-optic cabling and other outside plant equipment, also known as the "passive" elements of the FTTP system. The vendors are: Corning Cable Systems, a subsidiary of Corning Inc., of Corning, N.Y.; ADC, of Eden Prairie, Minn.; Preformed Line Products Co., of Cleveland, Ohio; and Tyco Electronics, of Harrisburg, Pa.

They join four other companies that Verizon selected and announced last month: Advanced Fibre Communications Inc. for the central-office electronics; and outside plant suppliers Sumitomo Electric Lightwave, Pirelli Communications Cables and Systems North America, and Fiber Optic Network Solutions (FONS).

"With vendor selection complete, we are continuing work on our plans as well as the development of operations support systems (OSS) to start deploying a new technology that will revolutionize this industry," Lacouture said.

"FTTP will enable a new broadband economy through the delivery of a vast array of high-speed, high-capacity data services, along with voice and video products, to consumers and business customers. Our investment in this new technology will create new revenue streams through the development and sale of new products that can only be provided over this type of technology - while delivering cost-savings for Verizon through reduced operational and maintenance expenses," he said.

Lacouture said the new technology is capable of transferring data at speeds up to 622 megabits per second to the user and 155 megabits per second to the network - far faster than cable modems or today's DSL.

"We believe our deployment of this technology will have widespread benefits throughout the economy of our nation by stimulating products that can only be delivered over this platform," he said.

Verizon will invest in FTTP next year without an increase in its historical capital spending levels. Verizon's capital investment plans will begin to shift from deploying copper to building a network based on FTTP technology to better serve customers and improve the company's already strong competitive position. Verizon's initial deployment plans involve passing about 1 million homes with the new technology in 2004, with the deployment pace potentially doubling in 2005.

FTTP is an advanced fiber-optic technology that can be used instead of copper wires to connect a home or business directly to Verizon's network, allowing the company to provide new high-speed, high-capacity data products, in addition to voice communications and video applications. Fiber-optic systems use hair-thin strands of glass fiber and laser-generated pulses of light to transmit voice, data and video signals at speeds and capacities far exceeding today's copper cable systems.

With over 9 million miles of fiber-optic systems already in place in Verizon's network - including all of the links between Verizon's central-office switching systems -- the installation of FTTP will represent a natural extension of this fiber technology over the so-called "last mile" to residences and businesses.

Verizon will install the new technology in two ways: directly connecting existing homes and businesses to the company's network as they order services that use the new technology, and installing fiber-optic lines to many new residential developments and business premises as they are being built.

"As we continue to move ahead, it is important to stress that the Federal Communications Commission (FCC) must further clarify the rules it recently released," Lacouture said. "It is imperative, for example, that we receive assurances that we will not be forced to share our investment in this new technology with our competitors, as is the case with copper facilities today. This sort of regulation will only serve to deter our investment in these new technologies."

Verizon will continue performing lab and technology interoperability tests on the FTTP systems, ensuring the new technology works properly with existing and new Verizon operations support systems. In the first half of 2004, Verizon expects to begin initial test-deployments in at least two communities. By the end of the year, the company expects to deploy the new technology in over 100 central offices across nine states.

A Fortune 10 company, Verizon Communications (NYSE:VZ) is one of the world's leading providers of communications services, with approximately $67 billion in revenues. Verizon companies are the largest providers of wireline and wireless communications in the United States, with more than 139 million access line equivalents and 36 million Verizon Wireless customers. Verizon is the third largest long-distance carrier for U.S. consumers, with nearly 16 million long-distance lines. The company is also the largest directory publisher in the world, as measured by directory titles and circulation. Verizon's international presence includes wireline and wireless communications operations and investments, primarily in the Americas and Europe. For more information, visit www.verizon.com.

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