Verizon’s already talking to content creators about ways to enable subscribers to access video content nationally. “You could do a wireless over-the-top” — the jargon term for an Internet pay TV service — CEO Lowell McAdam told attendees at the Morgan Stanley Technology, Media & Telecom Conference. “We’re going to work with them and find a model.” That’s been difficult until recently, he says, because many programmers feared that a new service could upset a TV distribution system that’s been lucrative for them. But many now realize that with Internet pay TV “you can get a virtuous cycle” where everybody grows. Verizon took a step toward developing its own wireless over-the-top service in January when it bought Intel’s OnCue platform. “The set top box in an OnCue environment is a little bigger than the tip of my thumb,” McAdam says. Wireless offers Verizon a relatively inexpensive way around its aging copper wire network at a time when he sees signs of video cord cutting. A few years ago his FiOS fiber optic service signed up an equal number of broadband and video customers. “Now we’re seeing significant divergence. People are buying a lot more broadband.”
Netflix has complained that its transmissions to Verizon broadband customers have been slowing — but McAdam says that should be resolved soon with a Netflix payment arrangement similar to the one it just cut with Comcast. “I’ve spoken live and via email with [Netflix CEO] Reed Hastings and I think we’ll have an arrangement with them as well.” The Verizon chief adds that he’s content with the state of net neutrality regulation following a mixed court ruling in its challenge to the FCC’s rules. Although some groups are “trying to whip this up as an issue,” he says, “everyone has lowered the temperature a little.” FCC Chairman Tom Wheeler says he’ll crack down on ISPs that discriminate. “That’s what we’d like to see him do…You can’t just regulate the carriers.”
Subscribe to Deadline Breaking News Alerts and keep your inbox happy.