The general counsel of the Federal Communications Commission predicts your landline will stop working within the next ten years, abandoned by companies like AT&T and Verizon in favor of wireless service in rural America or fiber (if you are lucky) in the cities.

Phillip “Did you know your landline will be dead within ten years?” Dampier

Sean Lev, the FCC’s general counsel, said in a blog post that “we should do everything we can to speed the way while protecting consumers, competition, and public safety.”

But the FCC seems to be abdicating its responsibility to do exactly that by singing the same song some of America’s largest phone companies have hummed since they decided to get out of the copper landline business for fun and profit.

Traditional boring telephone service is regulated as a utility — a guaranteed-to-be-available service for any American who wants it. Hundreds of millions of Americans do, especially in rural areas where America’s cell phone love affair is tempered by dreadful reception, especially in mountainous areas. Oh, and the nearest cable company is ten miles away.

AT&T and Verizon — two of America’s direct descendants of the Bell System, just don’t want to pay to keep up a network most of urban America doesn’t seem to want or need anymore. In addition to a dwindling customer base, providing a regulated legacy service means having to answer to unions and government-types who make sure employees are fairly compensated and customers are given reasonable service at a fair price. The alternatives on offer from AT&T and Verizon carry no such regulatory (or union) baggage. Prices can change at will and customers have no guarantee they will receive service or have someone to complain to if that service is sub-standard.

While in the past regulators have taken the lead to make sure telephone companies meet their obligations, the new FCC seems to spend most of its time observing the business agendas of the companies themselves.

Lev implied to the Associated Press the FCC is not exactly leading the parade on the future of landlines. He seems more comfortable trying to analyze the intentions of AT&T and Verizon’s executives:

Most phone companies aren’t set to retire their landline equipment immediately. The equipment has been bought and paid for, and there’s no real incentive to shut down a working network. He thinks phone companies will continue to use landlines for five to 10 years, suggesting that regulators have some time to figure out how to tackle the issue.

Lev

AT&T is more direct: It wants to switch off all of its landline service, everywhere, by 2020. Customers will be given a choice of wireless or U-verse in urban areas and only wireless in rural ones. Where U-verse doesn’t serve, AT&T DSL customers will be in the same boat as Verizon customers on Fire Island: pick an expensive wireless data plan, satellite fraudband, or go without.

Verizon prefers a “gradual phase-out” according to Tom Maguire, Verizon’s senior vice president of operations support.

Verizon claims it has no plans to shut down working service for customers, but it does not want to spend millions to continue to support infrastructure fewer customers actually use. That means watching the gradual deterioration of Verizon’s copper-based facilities, kept in service until they inevitably fail, at which point Verizon will offer to “restore service” with its Voice Link wireless product instead.

For voice calls, that may suffice for some, especially those comfortable relying on cell technology already. But at a time when the United States is already struggling with a rural broadband problem, abandoning millions of rural DSL customers only makes rural broadband an even bigger challenge. The wireless alternative is too variable in reception quality, too expensive, and too usage capped.

Island residents are smoking hot about Voice Link

The New York Public Service Commission has extended the deadline for public comments about the Voice Link wireless landline replacement until Sept. 13, to give the growing number of customers on Fire Island with the service enough time to fully evaluate it over the summer months.

To date nearly 400 public comments have been filed with the Commission, every one of them negative.

Stop the Cap!’s comments are having an impact on the PSC’s exploration of the deployment of Voice Link in upstate New York. On our recommendation, the PSC has formally asked Verizon for more documentation about how Voice Link is being introduced in the Catskills:

Please provide the following information for all Voice Link devices/services that have been installed at any customer premises locations outside of the Western Fire Island area:

• The address of every Voice Link customer in upstate New York;
• Date Voice Link Installed;
• Reason Voice Link Installed;
• Was customer advised Voice Link service was optional or not;
• Voice Link Service Calls/Repairs identified by location, date, reason for service visit, repair action taken;
• If applicable to any locations, date Voice Link was uninstalled/disconnected and reason for termination;
• Please provide any marketing materials, scripts, and/or training materials in use by Verizon employees or contracted third-party workers to inform customers about Voice Link service;
• Please provide copies of any documentation provided to customers agreeing to accept Voice Link service outside of Western Fire Island, including Terms of Service Agreements. If there are any material differences between documentation and Terms of Service agreements for Western Fire Island customers, and customers in any other areas of New York State, please identify and explain those differences.

The PSC is also demonstrating that it is willing to go deep into the weeds with Verizon on this issue, a marked departure from the near-rubber stamp “light touch” regulation AT&T enjoys in several midwestern and southern states. At one point, the Commission found Verizon documentation indicating enough “spare pairs” — unused lines — were available that could be used to repair and reintroduce landline service on Fire Island, and wants to know why Verizon is not using them to bring back the service customers had before Hurricane Sandy did its damage:

The copper cable table shows that the spare cable pairs in the copper cable facilities serving the 11 identified communities is approximately 16% of the total available pairs in those cables. However, in specific communities such as Fair Harbor, Kismet, Robins Rest and Lonelyville, the percentage of spare pairs ranges from 21% to 66% of the total available pairs. Also, the number of working pairs in many locations is small compared to the total available pairs in the cables, despite the number of defective pairs reported by the company. Please explain why Verizon is not utilizing existing spare cable pairs, and performing routine cable maintenance in any communities, to restore wireline services to customers that do not request or desire Voice Link service.

The fiber cable table shows spare cable pairs in the fiber facilities serving the Ocean Beach, Lonelyville, Fair Harbor and Kismet communities is approximately 73% of the total available pairs in those fiber cables. By individual community, the percentage of spare pairs ranges from 62% to 94% of the total available pairs. Please explain why Verizon is not utilizing existing spare fiber pairs in any of the four named communities to restore wireline services to customers that do not request or desire Voice Link service.

Despite every effort by Verizon, Fire Island residents that lost landline service are increasingly opposed to Voice Link, if the public comments filed with the Commission are any indication.

The Point o’Woods Association on Fire Island, which represents more than 500 people who either seasonally or year round depend on Verizon’s landline network, is also highly critical of Voice Link’s performance and provided the Commission with very specific and detailed criticisms:

1. Verizon’s only cell site on Fire Island on the Ocean Beach water tower lacks reliable power backup contingencies;
2. Fire and medical first responders across Fire Island have declared Voice Link unsatisfactory for public safety;
3. Voice Link’s performance has been called unreliable. The sound is “plagued by echoes, connection delays, no connection at all, and frequent dropped calls;”
4. Voice Link only works with CDMA spectrum for voice calling, reducing the level of service (data) customers used to have with traditional landlines;
5. Customers cannot reach a live operator by dialing “0” and must dial all ten digits for all calls. The service also does not support collect calls, a feature “sometimes critical in emergency situations;”
6. The reception quality of Verizon’s data network varies widely across the island.

“Voice Link at its very best is a temporary solution suitable for deployment only while full communications infrastructure is in the process of restoration,” concludes D.R. Brown, vice president of the association.

The changes Verizon seeks for Fire Island are affecting even those who still have landline service. Customers regularly report that Verizon customer service is refusing repair requests in areas like Ocean Beach, pushing customers to the wireless replacement it wants them to accept.

Jean Ufer, a Fire Island resident, says Verizon is threatening the health of her husband by refusing to fix her service.

“They will not repair my landline, which my husband really needs, as he has a pacemaker which has to be monitored by a landline,” Ufer complained to the Commission. “They also refused to connect my DSL, even though they charged me  the monthly fee right through the winter.”

Moffett

A consolidated cable industry envisioned by Dr. John Malone, currently bidding for a merger between Charter Communications and Time Warner Cable, would feature widespread usage caps and usage billing and could obliterate competition from over-the-top online video providers, predicts a cable industry analyst.

Craig Moffett, now out on his own as co-head of independent Wall Street research firm MoffettNathanson, says broadband usage pricing is the sleeper issue of the last five years.

“I’ve written for years that [usage based pricing] is the single most important issue in all [the telecom sector],” Moffett said in an interview last week. “I’ve always been amazed by how little attention people have always paid to the issue.”

The Street reports that a unified cable cartel limiting consumer access to the Internet or more importantly monetizing that access would immediately devastate streaming video competitors including Netflix, Amazon, YouTube and Hulu.

If usage based pricing were implemented across the cable industry tomorrow, Moffett believes Netflix’s subscriber base would immediately fall from 30 million to 10 million. Nascent video players like Intel and Apple would likely find their business plans untenable, and some analysts believe the sweeping price changes would probably end the shift towards integrating streaming technology into large flat panel television sets.

Consumer backlash

Moffett says the impact would be broadly felt. Other analysts predict it could cause a national consumer uprising, especially at a time when other countries are swiftly moving to get rid of usage limits and consumption-based billing that have never been popular with customers.

“I think it will become clear that over the summer the window may have already closed for the cable operators to move to a usage based pricing theme,” Moffett said.

The Federal Communications Commission has done almost nothing about the issue of usage caps and usage pricing. Former FCC chairman Julius Genachowski even applauded the unpopular price scheme, calling it an important innovation.

Customers call it something else, and an uproar from consumers and competitors alike could overshadow the broadband successes of the Obama Administration. It would represent “a laughable setback for the nation’s communications infrastructure,” predict increasingly pessimistic Wall Street analysts concerned about the inevitable backlash.

The Street:

In a new broadband pricing regime, regulators would have to condone what consumers and competitors would immediately recognize as anti-competitive. Meanwhile, immensely popular content providers such as Netflix, Amazon Prime, Hulu, YouTube and the like would have to lose a Washington lobbying battle to the interests of cable monopolies, their arcane billing and off shored customer service.

Hollywood and broadcast networks would lose marginal new content buyers such as Netflix. Tablet makers such as Apple, Google, Samsung and Amazon would see the value of their fastest growing products put at risk.

Most importantly, it would be an affront to one of the few clear consumer victories for the Department of Justice in the Obama administration.

Schneiderman

The New York Attorney General has some strong words for Verizon Communications:

“Verizon [must] divest those portions of its New York franchise where it is no longer willing to continue providing wireline service and replace Verizon with another carrier that will provide wireline service.”

Attorney General Eric Schneiderman is more than a little concerned with Verizon’s plans to abandon offering landline service on the western half of Fire Island and potentially other areas further upstate to satisfy the company’s wireless business strategy.

In a hostile 13-page filing directed to the New York Public Service Commission, Schneiderman’s office accused Verizon of abdicating its responsibility to provide universal access to high quality landline service in favor of moving customers to inferior Verizon Wireless service.

“Verizon is asking the Commission to depart from a century of telephone service regulation, which had as one of its fundamental principles, universal wireline telephone service for all customers,” Schneiderman wrote.

In return for a guaranteed monopoly, profits, and a secure franchise area across portions of New York, telephone companies like Verizon historically agreed to offer phone service to any customer who wanted it. State and federal universal service rules provided subsidies to phone companies to reach their most rural or expensive-to-reach customers.

The goal, Schneiderman argued, was for every resident in New York to have home phone service, enabling them to communicate with their doctors, families, schools, friends and businesses, as well as to send for police, fire and ambulance assistance in an emergency.

Verizon’s intended replacement, Voice Link, represents a downgrade in service even worse than hundred-year old copper wire “plain old telephone service,” according to the attorney general. Schneiderman called Verizon’s Voice Link inferior and its thick 10-page terms, conditions, and disclaimers “legalistic,” leaving consumers without services they previously received or imposing significant new burdens and obligations.

The issues cited by Schneiderman:

Voice Link Service “is not compatible with fax machines, DVR services, credit card machines, medical alert or other monitoring services or some High Speed or DSL Internet services.” Customers in western Fire Island and other rural parts of New York have no FiOS or cable modem Internet providers to switch to, so those who rely on these services have no alternatives if switched to Voice Link.

Because Voice Link “may not be compatible with certain monitored home security systems,” customers’ homes and businesses will be at greater risk from flooding by burst plumbing, fire or burglars. In the case of plumbing emergencies, visit Carlson Plumbing Company website for reliable solutions and prompt support.

Although wireline customers whose service is suspended for nonpayment can still reach a 911 operator in emergencies, suspension of Voice Link “will prevent ALL Service, including any 911 dialing and associated emergency response services. Customers may also lose the ability to receive or place calls, even to 911, if they fail to “promptly notify Verizon” of a change in their address, email, or credit card expiration date.

Customers must “defend, indemnify and hold harmless Verizon from and against all claims … for infringement of any intellectual property rights arising from use of Voice Link or its software.”

Voice Link Service “does not allow the Customer to make 500, 700, 900, 950, 976, 0, 00, 01, 0+, calling card or dial-around calls (e.g., 10-10-XXXX),” so customers will be unable to use such pay-per-call information services. Voice Link Service “does not allow the Customer to accept collect calls or third number billed calls. The Company will not bill any charges on behalf of other carriers. [Customers] must have an International Calling Plan in order to make international calls. Wireline customers are able to subscribe to toll and international calling plans provided by other carriers, and have these and other third-party service charges included on their Verizon bills.

Verizon Voice Link

Voice Link Service “is subject to the availability of adequate wireless coverage throughout your home, and is not available in all locations.”

Unlike wireline service, which supplies its own power over the copper wiring, Voice Link uses customers’ house current to operate. Verizon has not disclosed how much customers’ electric utility bills will increase to power the Voice Link device. Also, if electric power is interrupted, Customers may have to “reset or reconfigure equipment prior to using” Voice Link. This may be difficult for some physically limited or technologically unsophisticated customers to perform.

During power interruptions, the wireless Devices used in Voice Link are battery operated. Although the Devices include a rechargeable battery back-up that provides only 36 hours of standby power and up to 2.5 hours of talk time in the event of a commercial power outage, “[a ]fter the battery is exhausted, the Service (including 911 dialing) will not function until power is restored.”

After the expiration of a one year replacement warranty for the battery back-up included with customers’ wireless Device, customers “are responsible for replacing the back-up battery as needed,” but Verizon has not disclosed the cost of such replacement batteries.

Wireline customers purchase their own telephones from competitive manufacturers, but the Voice Link device is only supplied by Verizon, which continues to own it. Thus, customers will have to pay Verizon to repair the device if “such repair or maintenance is made necessary due to misuse, abuse or intentional damage to the Device.” Verizon has not disclosed what [the] repair or replacement might cost customers in such event.

When wireline customers end their service with Verizon, they have no equipment to return to the company. However, Voice Link customers who cancel their service “are responsible for returning their Wireless Device to [Verizon] in an undamaged condition. Failure to return the Device within 30 days … may result in [Verizon] charging [customers] an unreturned equipment fee.” Verizon has not disclosed the amount of this fee.

Schneiderman accused Verizon of dragging its feet on repairs on Fire Island and forcing Voice Link on customers as the only available alternative.

“It is clear that Verizon is leveraging the storm damage from Sandy as part of its long-term strategy to abandon its copper networks by substituting Voice Link for [landline] service on western Fire Island and forcing customers to accept wireless Voice Link wherever it does not build FiOS,” Schneiderman argued. “Verizon’s failure to make prompt repairs to its Fire Island facilities during the seven months following Sandy left the Commission little choice but to provide temporary approval of Voice Link so that customers would have some form of telephone service during the 2013 summer beach season. However, this ‘temporary approval’ should not be expanded to allow Verizon to avoid its obligations permanently, on Fire Island or anywhere else in New York.”

Schneiderman wants the PSC to force the issue with Verizon, and not on the preferred terms of its senior executives.

“Rather than allow Verizon to provide inadequate Voice Link service to Fire Island and other New York customers, the Commission should compel the company to either maintain its wireline network throughout its franchise territory or sell
those parts where it is unwilling to do so to another provider that will provide adequate service,” Schneiderman wrote.

Free TV? Not quite.

Despite offering free over-the-air television, ABC is putting its programming and stations behind a new paywall that can only be breached by “authenticated” cable and AT&T U-verse subscribers able to prove they already pay to watch.

Watch ABC is the television network’s contribution to the cable industry’s “TV Everywhere” project that offers online viewing options for current cable television subscribers.

Watch ABC now offers on-demand and live viewing of programming aired by the network and six network-owned television stations both at the desktop and through apps for iOS, Android, and the Kindle: New York City’s WABC-TV, Philadelphia’s WPVI, Los Angeles’ KABC, Chicago’s WLS, San Francisco’s KGO, and Raleigh-Durham’s WTVD. (Coming soon: Houston’s KTRK and Fresno’s KFSN.)

During the “online preview,” ABC permitted online viewers within confirmed coverage areas to watch the station nearest them for free. Now, viewers will also have to confirm they are paying cable or AT&T U-verse customers to watch online.

But even then, not everyone will qualify. ABC only has streaming authentication agreements with AT&T U-verse, Cablevision, Charter, Comcast, Cox Communications, and Midcontinent Communications. Watch ABC is currently off-limits to everyone else, including customers of Verizon FiOS, Time Warner Cable, and both satellite services.

ABC has also banned IP addresses known to be associated with anonymous proxy servers. This measure is designed to enforce geographic restrictions to be sure only local viewers can get access to the station in their area.

By this fall, ABC affiliates owned by Hearst are expected to also join Watch ABC’s paywall system.

ABCNews.com announced an experiment with a paywall in the summer of 2010. It never came to fruition.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/WPVI Philadelphia Watch ABC in Philadelphia 5-14-13.mp4[/flv]

WPVI in Philadelphia turned over airtime during its evening newscast to self-promote the new ‘Watch ABC’ app and explain how it works. Effective now, it only works with preferred partner cable companies and AT&T U-verse. (Aired: May 14, 2013) (2 minutes)