TV Service Stalls for Verizon, but Increase in Wireless Customers Keeps Earnings Strong

Verizon Communications is having a harder time pushing its television service, which competes with the big cable companies, but the company said the slowing economy had not hurt its cellphone business. In releasing its earnings report on Monday, Verizon said it added 1.5 million new wireless customers, the same number as last quarter. It was 25 percent fewer than the two million it added in the fourth quarter of 2007, but Verizon Wireless, which is a joint venture with Vodafone, said its churn rate — the pace at which customers defect to other carriers — fell to 1.1 percent from 1.2 percent in the previous quarter. By comparison, Sprint Nextel has a churn rate of 2.45 percent. Analysts, however, were concerned about the pace at which Verizon was winning customers for its fiber optic delivery of television programming, called FiOS TV. Verizon added 176,000 customers in the last three months, compared with 263,000 customers in its first quarter. In addition, the company said it added 187,000 FiOS Internet customers. Verizon's high-speed-Internet subscribers rose 12% to 8.3 million, a growth rate less than the 26% increase in the year-earlier period. The slowdowns reported by both AT&T and Verizon raised questions about whether the high-speed-Internet market is maturing or whether phone companies' DSL services are losing ground to cable companies' faster offerings.