Verizon Business has quietly developed an enterprise version of its popular residential FiOS high-speed Internet service that could save companies a bundle on energy costs.

The corporate grade "service," initially designed for the U.S. military, involves installing the same passive optical network (PON) gear used for FiOS in office buildings and corporate campuses (it's unclear yet whether the offering will also one day be delivered as a managed service). It will be marketed to federal, corporate and university customers beginning in 2009, Verizon officials say. Ideal customers are those with high bandwidth demands, such as for sharing CAD drawings, streaming video or real-time workgroup collaboration.

The first installation is in a new, four-story office building in Annapolis Junction, Md., that was designed for military contractors and will be ready for occupancy in September. Verizon has been working with systems integrator Science Applications International Corp. (SAIC) for two years to develop the PON offering. Verizon is a subcontractor to SAIC for the network inside the new Washington, D.C.-area office building.

Click to see: Diagram of how Verizon Converged-Fiber-to-the-Desktop would help save enterprises space and power usage

Both companies plan to sell the PON system, which supports familiar network protocols such as Gigabit Ethernet. Verizon calls its new corporate-grade product Converged Fiber-to-the-Desktop (CFttD), while SAIC has dubbed its version Secure Converged Solutions (SCS).

Both new products are based on the same Fiber-To-The-Premises (FTTP) technology as  FiOS, which is what Verizon calls its residential broadband service that offers Internet, telephone and TV service sent over a fiber-optic network. On April 28, Verizon reported a total of 1.8 million FiOS Internet customers and 1.2 million FiOS TV customers. 

The new fiber-to-the-desktop offering sounds too good to be true. Verizon officials say it cuts floor space and electricity usage in office buildings by as much as 95% compared to traditional copper networks. It requires half the upfront equipment investment and installation time, and it promises easier ongoing operation and maintenance because it has fewer moving parts, they say.

``The nice thing about a passive optical network is that the fiber sits in there and it has tons of excess capability for your future. It can support you even if the equipment on either end changes over time,’’ says Ed Hill, director of technology and operations for Verizon Business’ Federal Network Systems.