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Verizon Files Tariff Allowing Company to Abandon Wired Phone/Broadband Service in New York; Fire Island First to Go

Phillip Dampier May 7, 2013 Competition, Consumer News, Public Policy & Gov't, Verizon, Video, Wireless Broadband 19 Comments

fire islandVerizon Communications has filed a formal tariff obtained by Stop the Cap! with the New York State Public Service Commission (PSC) that would establish conditions under which it can abandon its wired network in favor of wireless-only service.

If approved, Verizon will be able to drop wired landline and broadband service in any area of the state if the company can:

  • certify that a substantial portion of its facilities in an area are destroyed, rendered unusable, or beyond reasonable repair, or,
  • demonstrates that the use of wireless to serve specified customers, or groups of customers, is otherwise reasonable in light of the geographic location, the availability of competitive facilities to serve those customers or groups of customers, or in light of other criteria acceptable to the PSC.

Verizon is using the case of Fire Island, N.Y., to attempt a rewrite of New York’s communications tariffs. Although eastern Fire Island suffered some damage from Hurricane Sandy, a considerable amount of Verizon’s infrastructure further west did not survive the storm. Verizon wants to abandon that wired infrastructure, avoid spending money to upgrade the island to fiber optic service, and switch customers to a voice-only, wireless service called Voice Link that would leave Verizon’s DSL customers without broadband.

verizonAlthough Verizon has currently only applied to drop wired service to the “western portion of Fire Island,” the tariff would set conditions under which Verizon could abandon its landline network for financial reasons in other portions of the state. For example, Verizon could argue that its declining number of rural landline customers are no longer financially viable to serve because of wired network upkeep and upgrade expenses. Verizon’s application would also allow it to abandon older facilities where competitive services (wireless or wired) are available, and allow Verizon’s wireless products to be considered a suitable alternative to meet universal service requirements.

Verizon says it will offer the same basic calling packages that landline customers can get at the same or lower prices. The company also promises to adhere voluntarily to PSC regulations on customer protection, customer complaints, service quality, safety and reliability.

But Verizon does not promise to offer a functionally equivalent wireless replacement for the landline.

For example, Verizon only promises to support voice calls, access local and toll calling, emergency services with E911 capability, assistance services, telecommunications relay services, and directory listings, including the option of non-published service.

Data services are not supported. Current Verizon DSL customers with unlimited use plans will be forwarded to Verizon Wireless to sign up for the same limited use wireless broadband plans already available in the rest of the country (the ones that charge $50 for up to a handful of gigabytes of monthly usage, depending on the plan). Business customers will need to buy new equipment and sign new contracts with Verizon Wireless (or other wireless carriers) to process credit card transactions. Although some voice calling features are supported, an exact list remains unavailable.

In the event of a power failure, a built-in backup battery will provide up to two hours of talk time, after which the line will stay out of service until commercial power is restored.

Verizon Voice Link: The company's landline replacement, works over Verizon Wireless.

Verizon Voice Link: The company’s landline replacement, works over Verizon Wireless. (Asbury Park Press)

Because Verizon Wireless’ existing cellular network serving Fire Island is inadequate, the company has agreed to upgrade and improve service to the island.

Verizon argues its wireless solution is the only answer that makes sense.

“The cost of replacing facilities is very high, and if hurricanes or other severe storms occur in the future, there is a significant risk that the newly installed outside plant would again be damaged or destroyed,” argues Verizon’s Manuel Sampedro, who is overseeing Verizon’s service restoration effort on Fire Island. “Wireless service is already the predominant mode of voice communication on the island.”

But in the event of another major storm, Verizon’s wireless facilities could also be knocked out of service, potentially for weeks, as happened during Hurricane Sandy.

In the nearby coastal city of Long Beach, N.Y., every cell tower in the area failed because of the storm . City Manager Jack Schnirman told the FCC at a recent hearing wireless proved no more robust than any other technology, and described a frustrating experience attempting to reach representatives from major cell phone carriers about when exactly service could be restored.

“Long Beach reached out to one of the carrier’s customer support departments, explained the devastation and inquired about the carrier deploying a cell on wheels,” Schnirman said. “The customer service rep replied, ‘you might want to look that up on the Internet, I don’t know what that is.’ Well obviously, ironically, we had no Internet at that time.”

Customers did not fare any better.

“There was one woman in particular who passed away, of natural causes, an elderly woman,” Schnirman said. “And her daughter had to walk literally a mile and a half from her home to police headquarters just to say, ‘Listen, my mom has passed, and I thought I should tell somebody.’ ”

Wireless carriers are not obligated to provide backup service in the event of a power failure. An FCC effort to set minimal standards for backup cell service was met with legal threats by the wireless industry and the FCC backed down.

Verizon is in a hurry to win approval of its tariff change, requesting its filing be approved and take effort on less than 30 days’ notice with a waiver of the requirement that it publish a public notice about the change in area newspapers.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Reuters ATT Verizon try to put end to landline telephone era 4-5-13.flv[/flv]

Reporter David Cay Johnston says Verizon and AT&T’s efforts to abandon the landline are no accident. They are part of a larger lobbying effort to abandon company obligations under the “carrier of last resort” policies that guarantee every American access to quality landline telephone service. Wireless phone service is unregulated. Johnston isn’t the only one reporting on this story. Stop the Cap! has covered it repeatedly since early 2010. (2 minutes)

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elfonblog
8 years ago

Ok Verizon, you can abandon Fire Island, but we’re taking back your exclusivity zones, tax breaks and other subsidies. And if a potential competitor moves into your old stomping grounds, you are unconditionally barred from whining about it for a period of time no shorter than the period in which you had originally occupied the territory.

James Cieloha
James Cieloha
8 years ago

Every Verizon customer in Fire Island, New York should be ashamed of Verizon for choosing to abandoned wireline service in favor of the Voice Link wireless serivce in Fire Island, New York very severely. I feel that Lowell McAdam and Fran Shammo with Verizon are trying to be way too big being like the Wal-Mart’s, the Marlboro’s, the Joe Camel’s, the Paramount Pictures with the movie theater chain of the 1940’s, the Clive Davis’s when he was at Columbia Records in the 1970′s, the Neil Bogart’s of Casablanca Records fame of the 1970′s disco era, the Trinity Broadcasting Network’s, the… Read more »

elfonblog
8 years ago
Reply to  James Cieloha

Ok, I think that’s enough, mister.

Scott Dunn
Scott Dunn
8 years ago

Seems like there should be some competitor interested in laying fiber to service these customers. I doubt that Google Fiber could land there, but isn’t there someone else willing to build the service and infrastructure?

txpatriot
txpatriot
8 years ago
Reply to  Scott Dunn

Laying new or replacement infrastructure is a VERY expensive proposition, even if VZ stood aside and didn’t oppose it. That’s why you don’t see a spate of carriers rushing in to take over VZ’s wireline business. I sympathize with the people of Fire Island but I also understand why VZ is doing this.

elfonblog
8 years ago
Reply to  txpatriot

Yeh. “Thousands and thousands” is very expensive to you and me. Billions is expensive to an entity like Verizon. But unlike you and me, a telco can acquire a loan and perks to build mega-infrastructure, and make a breathtaking profit in the long run. It’s not the cost of replacing the infrastructure that has them worried whatsoever. But that is the language they use when speaking down to us outsiders. Personally, I don’t like to be condescended, and I roll my eyes at FUD like that. Verizon feels like dragging their heels and proposing fixed wireless as a suitable replacement… Read more »

txpatriot
txpatriot
8 years ago
Reply to  elfonblog

@elfonblog: If laying the infrastructure is as cheap (and profitable) as you imply, then you tell me why no other entities are rushing in to fill the void.

Also, your description of the likely damage to VZ’s facilities leads me to believe you have little to no actual experience with such facilities & damage. Please feel free to enlighten me.

elfonblog
8 years ago
Reply to  txpatriot

Actually, I think I did an adequate job of explaining how telcos can swing a project that is beyond the means of average men. As for my experience; Yes, I am qualified to speak. I work for a major company which provides data, telcom and hosting services to businesses. This is my 3rd such job, including having worked for Northop Grumman as a NOC engineer for a facility running core TX DOT and HHS servers. Before that, I worked for several local full-service ISPs, all of which suffered from the same manipulative monopoly telcos that Phillip writes about here. So… Read more »

elfonblog
8 years ago
Reply to  txpatriot

Oh, and lest you claim things like “plans change” or “industry realities”, “financial hardship”, etc., you should realize that VZ would never have deployed to Fire Island without figuring out what the lifetime of the cables would be, and known in advance what the cost of repairing infrastructure would be over the lifetime of their presence there.

Oh, and INSURANCE.

txpatriot
txpatriot
8 years ago
Reply to  elfonblog

@elfonblog: tell me under what conditions VZ would have had a choice to NOT deploy facilities to Fire Island? If VZ is the certified local provider on that island, then under normal regulatory requirements (caveat: I don’t claim to be an expert on the NY PSC but I assume their regulatory requirements are not different than other PSCs with which I am familiar, e.g., VA, OH, FL, OR, TX, etc.), they had an OBLIGATION to provide service to ANYONE on the island who wanted service. There’s no “cost-benefit” analysis. If they are the licensed provider, then they have to provide… Read more »

elfonblog
8 years ago
Reply to  txpatriot

I’m no expert on NY law either, so I’m not going to take a stab at straw men. But it’s not the end of the story. This blog does a great job of documenting cases where obligated providers construct amazing frameworks whereby to escape their obligations. Do you read it much?

txpatriot
txpatriot
8 years ago

Fiber is only a marginally better option than copper in terms of resiliency (I know fiber is preferable in terms of bandwidth but that’s not my point). But the fact is, fiber requires electronics to work, and those electronics are just as susceptible to water damage as copper wire (and for that matter, so are the electronics needed to make wireless work). So it gets back to money: knowing that all three are susceptible to water damage (copper wire, fiber electronics and wireless electronics), which makes more sense economically? The answer is wireless. You and your readers may not like… Read more »

txpatriot
txpatriot
8 years ago
Reply to  txpatriot

Also, it is a myth that fiber strands are not susceptible to water damage. In fact, they are; here are two examples:

http://204.246.68.195/icefree3.html

elfonblog
8 years ago
Reply to  txpatriot

Wireless is no match for fiber or even copper in terms of bandwidth, futureproofing or resiliency in adverse environments. Wireless is suitable for a quick initial deployment, but it’s not a long term solution, and it’s certainly not appropriate as a permanent replacement.

Picture the Dept of Transportation offering expensive bicycle rentals as a permanent solution to the whole IH-35 hwy upper deck pancaking onto the lower deck. That won’t fly. Fiber wins hands-down.

txpatriot
txpatriot
8 years ago

By the way, if anyone opposes this idea, they should make their views known to the NY PSC. I don’t know the rules in NY for protesting a tariff filing like this, I suppose at a minimum you must live in NY and be served by VZ wireline service in order to show you have a “justiciable interest”, but IANAL and will gladly defer to anyone reading this who actually knows the rules up there.

txpatriot
txpatriot
8 years ago

The NY PSC partially approved the VZ Tariff filing; you can find the Order and press release on this page: http://documents.dps.ny.gov/public/MatterManagement/CaseMaster.aspx?MatterSeq=42688 The NY PSC suspended the part of the tariff filing that would have allowed VZ to expand Voice Link beyond Fire Island. The NY PSC is asking for public comment regarding further deployment. Here is your chance to have your voices heard. Let the NY PSC know what you think about what VZ wants to do. I don’t know the rules for commenting in NY but I assume you have to be a NY resident and be either an… Read more »

txpatriot
txpatriot
8 years ago

FCC says slamming by VoIP providers is OK:

http://transition.fcc.gov/Daily_Releases/Daily_Business/2013/db0531/DA-13-1294A1.pdf

So it looks like VZ would not need FCC approval to unilaterally move these former POTS customers to VoIP if that’s what it wanted to do.

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