Verizon Award $1.05B Contract to Corning for Fiber and Related Hardware

Verizon Communications has announced a three-year minimum purchase agreement with Corning for the provision of fibre optic cable and associated hardware equipment to Verizon to ensure coverage and capacity for its nationwide wireless broadband network.

Under the new agreement, Verizon will purchase from Corning up to 20 million km (12.4 million miles) of optical fibre each of the three years from 2018 through to 2020, with a minimum purchase commitment of $1.05 billion.

It was noted that in recent months, Corning has announced plans to expand capacity and to invest more than $250 million in its optical fibre, cable and solutions manufacturing facilities to help address demand from carrier and enterprise customers worldwide. Corning expects that these capacity expansions will begin to come online during 2017 and become fully operational in 2018.

Verizon noted that it is engaged in revamping its network architecture based on a next-generation fibre platform designed to support all of the company's businesses. The new architecture is designed to improve Verizon's 4G LTE coverage, speed the deployment of a 5G network and enable the delivery of high-speed broadband to homes and businesses.

In an initial deployment, Verizon launched its One Fiber approach in Boston last year and plans to invest $300 million over six years to deploy it throughout the city. Verizon announced plans in April 2016 to build a new fibre network to support services including Fios in Boston, and invited expressions of interest from residents and small businesses in eight neighbourhoods in the city, which it calls 'fibre zones'.

In January of this year the company announced the launch for customers in parts of Boston, as well as Norfolk, Virginia, of the Fios Instant Internet service offering symmetrical 750 Mbit/s bandwidth.

Verizon also announced the launch of Fios Instant Internet in greater New York City and northern New Jersey, Philadelphia and Richmond, providing a total of over 7 million customers on the East Coast with access to its instant bandwidth offering.

Regarding the agreement, Viju Menon, Verizon chief supply chain officer, commented, "Verizon identified a shortfall in fibre supply and has been working with business teams to forecast demand and fill supply gaps with existing suppliers... securing the required volume of optical fibre and hardware solutions with Corning will ensure it can meet its planned rollout schedules".

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