Verizon Communications Inc., the second-largest U.S. phone company, doubled the speed of its most expensive FiOS broadband Internet service, seeking an edge against cable providers.
Verizon will begin offering five speeds of service next month, topping out at 300 megabits per second, according to a statement today. Pricing will be announced in June, the New York-based company said.
The new top speed, up from a previous high of 150 megabits, is designed to let consumers handle multiple Internet devices and more bandwidth-hogging applications. Still, most home Internet customers probably won’t notice the difference when they reach that level, said Jonathan Atkin, an analyst with RBC Capital Markets in New York.
“Once you get beyond 25 to 50 megabits, it’s all marketing,” said Atkin, who expects Verizon’s stock to perform in line with its peers. “Speed speaks to people at a visceral level. It makes sense that Verizon would try to highlight their advantage and get people to switch to their service.”
Comcast Corp., the largest U.S. cable provider, offers a rate of as much as 105 megabits. Cablevision Systems Corp., the fifth-largest cable carrier, offers speeds of up to 50 megabits, with an “ultra” package that boosts it to 101 megabits.
The higher speeds also will help customers stream high- definition videos, play live multiplayer video games and use tablet computers, said Verizon, which ranks second to AT&T Inc. in U.S. phone customers.
Verizon shares fell 1 percent to $41.32 at 12:31 p.m. New York time. The stock had climbed 4.1 percent this year before today.
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