Verizon Adds More FiOS TV Apps

 |  Includes: CMCSA, ROIA, VZ
by: Zacks Investment Research

US wireless kingpin Verizon (NYSE:VZ) has announced major enhancements to its FiOS TV service by expanding Video-on-Demand (“VOD”) content and launching a premium service that offers integration between cell phones and TVs. The carrier has reportedly launched US entertainment and lifestyle network TV One’s VOD services on its FiOS TV footprint.

Launched in 2004 and targeting the African-American population, TV One offers a wide range of real-life and entertainment-oriented programs, music, fashion, movies and cultural services to nearly 50 million households in the US. The company’s investors include the US cable giant Comcast Corp. (NASDAQ:CMCSA) and one of the largest radio broadcasting companies in the US, Radio One Inc. (NASDAQ:ROIA).

The launch is great news for FiOS TV’s African-American subscribers who can now celebrate the Black History Month (observed in the US in February) by accessing a broad range of premium VOD programming from TV One, including the history of African-American fashion and civil rights movement as well as various musical performances by top artists.

Moreover, Verizon has launched an innovative service which brings FiOS TV on smartphones. The service, called “Mobile Remote”, allows FiOS TV customers to use their mobile handsets as a remote control for their TVs. The handsets can be used to switch channels, transfer photos from phone to TV, import favorite-channel watch-lists from TV to phone and administer regular DVR functions. The service is currently available for Motorola’s (MOT) Droid and HTC’s Imagio smartphones and will be extended to other handsets in due course.

Verizon offers FiOS TV services by leveraging its high-speed fiber-to-the-premises network. The carrier launched multiple enhancements for the service in 2009, including new widgets and applications such as Facebook, Twitter, ESPN and Internet video services, through its new store “The Widget Bazaar”. FiOS TV currently offers 138 HD channels and 2,800 HD movie titles. Verizon recently launched premium cable TV channel HBO’s new website “HBO GO” on FiOS TV.

Verizon remains significantly challenged by the intense competition from cable TV operators who are aggressively promoting triple-play (voice, Internet and video) offerings to consumers. Moreover, FiOS TV competes neck and neck with AT&T’s (NYSE:T) U-verse TV service. As such, Verizon is aiming at countering competition from cable, satellite TV and other competing services by augmenting its FiOS TV offering to include differentiated features.

Expansion of its FiOS services remains an integral part of Verizon’s long-term growth strategy. The company continues to broaden the market penetration of its FiOS TV services, which currently average roughly 25% across all markets. Subscriber accretion also remains healthy for FiOS TV as around 940,000 new additions were registered in 2009.