GTE Corp’s GTE Telephone Operations is something of an anomaly in that although it provides local phone service, it has never been part of the Bell system, and accordingly is more lightly regulated than the Baby Bells. And it has confidently announced that it plans to get into the video delivery business, building a new video network that will pass seven million homes in 66 key GTE markets in 33 states within the next 10 years. By 2003, it expects to be delivering broadcast, cable and interactive television programming to about 2m residential customers. It intends to begin construction this year and to deliver programming on its network by 1995 in four markets: Thousand Oaks, California; St Petersburg and Clearwater, Florida ; Honolulu, Hawaii; and northern Virginia. It plans to invest $250m in the first phase, building separate networks alongside its existing ones, and is hoping for $1,000m in annual revenues from video services in 10 years. It initially plans to offer a video dial tone service, providing facilities for other programmers to deliver video services to the home but it will seek regulatory approval to offer interactive video programming of its own. It is also seeking an alliance with a cable company to extend phone and video service coverage.
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