Subscribe[flv width=”640″ height=”376″]http://www.phillipdampier.com/video/Verizon Wireless Mas Ad.flv[/flv]
Ever wonder what happened to comedian Paul Rodriguez? Me neither, but here he is anyway, shilling for Verizon Wireless’ overpriced, out-of-touch-with-middle-class-bank-accounts ‘Share Everything’ Wireless Data Overcharging plan. Who will Verizon choose next:
Judy Tenuta?
Wilford Brimley?
Ruth Buzzi?
TV’s Frank? (I sure hope not.)
The city council of Hilliard, Ohio is offering Verizon $4.2 million in tax breaks to move 1,500 Verizon employees to the community of 28,000 and hire 500 new employees to join them.
The 10-year tax deal will give Verizon a 50 percent incentive on income tax withholding for amounts in excess of $72 million, according to a report by ThisWeek. In 2015, the first full year of the incentive, Verizon’s payroll is estimated to reach almost $90 million.
Verizon is also applying for tax credits at the state level.
Jeff Brown, an attorney representing Verizon, called the agreement “truly a partnership between the entities.”
Critics call it truly short-changing local government.
Citizens for Tax Justice note this is not the first time Verizon has been offered tax breaks by Hilliard. In 2008, the city granted $3.4 million in tax subsidies and abatements to relocate 500 call center jobs (300 from out-of-state) to Hilliard. The state of Ohio also approved a 40 percent, five-year tax credit valued at $380,140. Another five-year tax credit amounting to $253,000 over five years was also granted later that same year.
Citizens for Tax Justice believes Verizon has successfully pitted communities against one another to compete for jobs and local investments at the same time the company is cutting both:
Despite being highly profitable,Verizon manages to avoid billions of dollars in federal and state taxes through tax code maneuvers as well as by seeking special tax breaks in the name of economic development. It also shortchanges local governments through property tax abatements as well as assessment challenges.
Whatever savings have come from this tax dodging have not been used to invest in the company or its workforce.Verizon has been eliminating jobs and investing less. During the past three years,the total number of employees at Verizon has fallen by more than 40,000 and the company’s capital expenditures have declined by $1 billion.
Verizon CEO Lowell McAdam telegraphed his plans to dump rural landline service last summer.
You should believe Verizon Communications CEO Lowell McAdam when he says he intends to end wired telephone and broadband service for areas that are simply not economically feasible for fiber upgrades. McAdam’s grand plan is now coming true for customers in parts of Florida and on Fire Island, N.Y.
Last summer, Stop the Cap! covered McAdam’s comments to Wall Street investors (that are always the first to know) at the Guggenheim Securities Symposium:
“In […] areas that are more rural and more sparsely populated, we have got [a wireless 4G] LTE build that will handle all of those services and so we are going to cut the copper off there,” McAdam said. “We are going to do it over wireless. So I am going to be really shrinking the amount of copper we have out there and then I can focus the investment on that to improve the performance of it.”
The writing is already on the wall:
Traditionally, customers reporting trouble on a phone line get a visit from Verizon technicians who track the problem down and repair it. But Verizon no longer wants to spend money fixing copper wire-related problems. Customers reporting chronic phone static or outages are now being asked to abandon their traditional landline service instead:
The end of an era.
Customers who live in Florida currently have a choice. During the trial, they can switch to Voice Link or keep their current landline service. On Fire Island, just south of Long Island, customers will not have that choice. Verizon is testing the will of New York regulators asked to allow the company to gradually abandon landline and wired Internet facilities on the island. Customers previously knocked out by Hurricane Sandy have no alternative — switch to a wireless option like Voice Link or lose telephone service. As the network degrades further on the island, it is a safe bet more Fire Island residents will find themselves confronted with a wireless future courtesy of Voice Link.
Verizon is careful to note its Voice Link service comes at no additional cost to customers — their phone bills will remain the same, at least for now. But the transition includes several important caveats:
Verizon’s solution for Fire Island represents the long-term vision of McAdam coming to fruition. Complaining customers have not been able to persuade the company to abandon its plan, but New York State regulators might, if the issue gets enough attention.
In states with less aggressive regulators, Verizon could implement its Fire Island strategy nearly at-will, especially in rural service areas. Verizon’s plan differs little from that of AT&T, another major service provider seeking permission from regulators to abandon rural landline networks. AT&T is betting the Federal Communications Commission will approve AT&T’s “network transition plan” for all of its rural customers. Verizon is starting smaller, gradually implementing its transition under the radar of many state and federal officials.
AT&T wants to wind down its own rural landline network.
So why adopt Voice Link — a wireless solution, when copper wire network repairs remain a viable option?
The reasons are simple:
Customers in Verizon service areas should appeal to regulators and their elected officials to stop the abandonment of wired infrastructure. Verizon argues maintaining its network doesn’t make sense when customers are fleeing their landlines. But rural customers are not disconnecting broadband service that travels across the same network. Even basic DSL is coveted in rural Verizon territories where Internet access remains unavailable. Just about everyone wants the option of FiOS fiber, perhaps the most coveted network upgrade around until Google announced its gigabit fiber project in Kansas City.
Nobody wants Verizon or AT&T to keep up its copper wire facilities indefinitely. But a better solution would be a regulatory mandate that requires Verizon and AT&T to gradually replace antiquated and failing copper infrastructure with fiber wherever possible. It is more than possible to do this on Fire Island. Verizon’s service area in Florida is hardly rural either. Verizon Florida (formerly GTE Telephone) serves Tampa-St. Petersburg east to Lake Wales, a major metropolitan region in central Florida.
What is best for shareholders should not be the final determining factor for an important utility service. If customers prefer the option of Voice Link for home phone service, there is nothing wrong with that. But wireless service as the only option customers have for broadband service? Not at Verizon Wireless’ prices.
Verizon officials have announced they will abandon their damaged wireline network serving several hundred permanent residents and businesses on Fire Island, replacing voice telephone service with a wireless system called Voice Link critics say will end high-speed Internet service and hurt business.
Fire Island’s landline network has been barely functional since Hurricane Sandy struck last October. Verizon has yet to make significant repairs, leading to ongoing complaints from residents who live on the island year-round. Verizon’s wish to eventually abandon its wired network facilities entirely has created concern among island officials and public safety agencies, noting the summer population on the island swells well into the thousands.
Verizon’s plan may leave businesses unable to process credit card transactions and prevent residents from getting back DSL broadband service they lost during the storm, much less get it in the future. For some, it represents turning the clock back to the days before Internet access.
“Verizon has given us a dial tone basically,” Ocean Beach Mayor James Mallott told Newsday. “But as far as DSL, ATMs, point-of-sale systems, all the rest of that stuff, we’re pretty much on our own.”
Fire Island resident Meg Wallace notes Verizon’s plan has not gone unnoticed by the New York State Public Service Commission. The PSC is currently monitoring the situation and invites comments from interested parties.
“Right now, only Saltaire has filed a formal complaint with them, along with one village’s fire official,” Wallace reports. “It is easy to register a complaint either by filling out a complaint form on their website or calling the NYSPSC directly at (800) 342-3377. They are concerned about public opinion, so the more calls and formal complaints filed by both home and business owners the better.”
Verizon officials have defended their decision, claiming a wireless system is more robust and can withstand severe weather better than a wired network. Another reality impacting the decision is the ongoing loss of landline customers. Verizon, the sole provider on the island, has lost 25 percent of its landline business in the last two years. The company claims 80 percent of Verizon-handled calls to and from the island are through Verizon Wireless.
Fire Island
Verizon told local officials that Cherry Grove and points east still have undamaged fiber optic and copper lines that should be able to work as usual this summer and will be left in place for now. On the west end of the island from Kismet to Sailor’s Haven, the damage was more significant and Verizon has announced its intention to abandon wired service.
Although west end customers will be scheduled for Voice Link installations starting in April, those on the east side should not get too comfortable with their wired service because Verizon has announced it will not upgrade or make future significant repairs to its wired infrastructure going forward. When the remaining landline facilities eventually fail, affected customers will also be moved to Voice Link.
How It Works
Starting April 1st, customers calling with service problems on Fire Island will be redirected to special operators trained to pitch customers the Voice Link service as a replacement. These agents will also handle billing adjustments and drop phone package features Voice Link does not support. If the customer only wants phone service, Verizon will schedule an installation date for Voice Link. A technician will arrive with a wall-mounted box about 8″ high that will be installed in the room that provides the best reception from a nearby Verizon Wireless tower. The box will then be connected to your home telephone wiring and a nearby power outlet so existing telephones will work once again. The box has battery backup powered by customer-installed and maintained AA batteries.
If a customer also had broadband service with Verizon, they will not be getting it back. Instead, an agent will attempt to sell the customer a Verizon Wireless mobile broadband package at a significantly higher cost. For example, a 10GB monthly usage plan added to an existing Verizon Wireless account will cost an extra $20 a month for the “Mi-Fi” mobile hotspot device fee and $100 a month for the data package. Verizon DSL in comparison offered unlimited access for $30-50 a month, depending on the plan selected and any promotional discounts.
Verizon said it is currently improving reception of its 4G LTE network in areas worst-affected by storm damage.
Voice Link is a voice-only product. It does not support broadband, telephone modem connections, faxing, alarm monitoring, home medical monitoring, certain communications equipment for the impaired, or other data services including credit card processing. It does support E911, which gives detailed address information to a 911 operator.
Verizon’s Voice Link also creates a problem for some satellite dish customers. Some satellite companies need a landline connection for handling pay-per-view orders. That data connection does not work with Voice Link either.
Your voice line bill will remain the same if you switch to Voice Link. But customers will lose the benefit of oversight from the Public Service Commission if things go wrong. Voice Link, unlike traditional landline service, is an unregulated service not subject to government oversight.
Voice Link: Coming Soon to Your Area?
Verizon’s Voice Link service is by no means intended to be used only on Fire Island.
Voice Link is being trialed in Florida (Project Thunder) as a landline replacement option for use in areas where Verizon’s copper network has deteriorated and the company is unwilling to spend money on fiber upgrades. If successful, Verizon intends to switch a growing number of Verizon customers nationwide outside of FiOS fiber areas to the wireless service when they report trouble with their phone lines.
Local 824 of the International Brotherhood of Electrical Workers provided insight when one of their workers attended a training class and participated in a ride-along with Verizon technicians installing the service in Florida.
John Glye reports that Verizon considers a customer a candidate for Voice Link if they have chronic phone line problems and only want traditional voice telephone service.
Currently, if customers in Florida are persuaded to switch, a migration order is created. If they want to keep the service they have, a traditional copper trouble ticket will be created and repair crews will be dispatched.
The unit is about eight inches tall and has the following connections:
Installation time is about 45 minutes. The unit must be mounted inside and the customer must supply power and a safe place for the unit. The customer’s existing copper line connection from the home to the pole is disconnected/removed. In the ride-along Glye participated in, he reports the customer was pleased with the outcome, having reported constant static aggravated by rain on her copper landline. After the wireless service was installed, the static was gone and the call quality was good.
Verizon Wireless and AT&T could cooperate to allow both companies to build market power in the United States and abroad with a buyout of Vodafone, now a part-owner of Verizon Wireless.
The world’s second largest wireless service provider (behind China Mobile), Vodafone could be subject to an American takeover if the two largest phone companies in the United States structure the deal together.
Bank of America-Merrill analyst David Barden suggested AT&T could buy Vodafone’s international assets at an estimate price of $70 billion, allowing Verizon to buyout Vodafone’s 45 percent stake in Verizon Wireless.
Barden warned the deal would be time-consuming, and likely attract strict scrutiny from regulators both at home and abroad, but a deal would give Verizon its desired full control of its domestic wireless operation and allow AT&T to become a major global player in the wireless marketplace in Europe, Asia, Oceania, and the Middle East.
An analyst from RBC made news last week suggesting AT&T could be amenable to selling its non-core assets to raise cash, including the sale of its wireless broadcast and cell towers — money that could be used to help pay for such a deal.
AT&T spokesman Brad Burns declined to comment specifically on the speculation by RBC, but admitted, “if we wanted additional flexibility, that could be an option for us.”
“In all cases, our decisions are driven by what’s right for the company and for our shareowners, so in that sense, nothing’s off the table,” Burns said. “But any comments by analysts about potential sales are simply speculation.”
AT&T achieved record cash flows in 2012 and will likely end 2013 with $14 billion in free cash, which could be used in an acquisition strategy or returned to shareholders.
Fran Shammo, chief financial officer of Verizon, noted the company has been interested in taking full control over its wireless division for some time.
The estimated cost of buying out Vodafone’s U.S. share is around $115 billion.
The "Massive News" theme by: Press75.com
