Verizon has inserted a change in their privacy policy to allow the company to share the exact addresses of their customers with advertisers to target location-specific ads on websites browsed while using Verizon as your Internet Service Provider.  The new policy also applies to Verizon Wireless customers.

“…Verizon will soon participate in a program that will improve the ability of advertisers to reach our Verizon Online customers based on your physical address. The goal is to provide online ads that may be more relevant to you.

This program uses your address to determine whether you reside in a local area an advertiser is trying to reach.

This advertising program uses your physical address to help advertisers deliver ads to websites you visit while using Verizon Online. This program allows national brands and local businesses to tailor offers, coupons and incentives to your local area. Because the ads can be geographically directed, they may be more relevant to you.”

They know what you are doing online and where you live, and now they want to share.

In fact, they are even more relevant to Verizon’s bottom line, because the company can extract higher advertising charges for this level of targeting.  For example, eateries could purchase advertising directed only to specific homes they feel are most likely to patronize their establishments.  If a local department store wants to target only homes on streets statistically likely to deliver higher-income, big spending customers, Verizon could provide that service as well.  If advertisers want to reach seedy neighborhoods to pitch home security systems, Verizon can identify their customers in sketchy areas and direct ads accordingly.

Verizon also informs customers they are preparing to start tracking all of your visits to various websites, and they will sell that information to their advertisers as well.

If you are not interested in letting Verizon follow you wherever you go and allow them to share your home address with advertisers of all kinds, you can opt out:

Verizon broadband Internet access customers may opt-out of the geographically-based advertising program described above by following the instructions here. Verizon Wireless Internet customers may opt-out of the relevant mobile advertising program by following the instructions here or by calling us at 1-866-211-0874. If you opt out online, you will need your account user ID and password. Also, please note that you will receive ads whether you participate in these programs or not, but under these programs, ads may be more relevant to you.

Thanks to regular Stop the Cap! reader Corrine and Bill Pytlovany for alerting us.

The Barstow Verizon Superpages

Verizon Communications today announced it was ending more than 100 years of residential telephone directory distribution, instead directing callers to online listings services or a CD-ROM, available free for California customers.  The White Pages will still be available upon request in print form, but the company expects many Californians will skip the request, keeping an estimated 1,900 tons of paper per year out of the California waste stream.

But if Verizon’s intent was to avoid excessive paper use, the effort comes up short.  The company will still automatically distribute the much larger, and much more lucrative Yellow Pages on every customer doorstep whether they ask for it or not.

Verizon asked the state Public Utility Commission to stop automatic distribution of the White Pages last October.  The PUC granted the request on June 9.  The last automatically delivered edition of residential listings will be the 2011-2012 Barstow Regional and High Desert Verizon Superpages in November.

Despite the discontinuation of the automatic delivery, customers will be able to order free residential print and CD-ROM versions of white pages directories by calling 1-800-888-8448 as each local yellow pages directory begins delivery.  In addition, all white pages listings are accessible at www.verizon.com/whitepages.

Telephone customers across the country, regardless of provider, can opt-out of all telephone directory delivery by visiting a website sponsored by the Association of Directory Publishers.

Wall Street is pushing back against Justice Department efforts to unwind a merger proposal between AT&T and T-Mobile that will leave America with three national carriers.  Some investment firms even believe three carriers are still “too many” and want mergers and acquisitions to accelerate to allow two dominant national carriers to emerge.

“It’s pretty clear what the end game is in wireless,” said Julie Richardson, managing director at Providence Equity Partners Inc. “LTE, 4G — you have to have those services to compete. One of the most interesting things to watch in telecom will be these players coming together.”

Richardson shares the view among many on Wall Street that carriers forced to build costly 4G services like LTE need less competition and more cash-on-hand to pay for upgrades and to obtain needed spectrum.

Only AT&T and Verizon Communications have the resources to support a national 4G Long Term Evolution network, Richardson said. Sprint, the third-biggest U.S. wireless operator, is struggling to compete against larger rivals and has lost money for 15 consecutive quarters, Bloomberg News reports.

Among smaller players, Richardson believes the future is clear: mergers, acquisitions, and partnerships.  Sprint is moving increasingly closer to the nation’s cable companies, which have sought a cost-efficient way to deliver the ultimate “quad-play” service package that includes wireless, landline, cable-TV, and Internet service, all from the cable company.  But talk of constructing competing cell networks has gone largely nowhere, and cable companies that do offer some type of wireless service typically resell an existing service under their own brand.  Road Runner Mobile, from Time Warner Cable, for example, is really Clearwire under a different name.  Same for Comcast’s wireless Internet service.  Cox is pitching “unbelievably fair” wireless phone service that actually comes from Sprint.

But cable operators currently don’t seem to be interested in outright acquisitions of cell companies like Sprint, preferring to partner with them instead.

Clearwire, which needs financing and better wireless spectrum, may eventually find a friend in Dish Networks, the satellite TV company.  Dish controls wireless frequency spectrum it currently does not use, and has expressed an interest in expanding beyond a traditional satellite television provider.  An acquisition of Sprint or Clearwire could help them accomplish that.

Verizon Communications was supposed to have a “neutral” position regarding the takeover bid by AT&T to absorb T-Mobile, but Lowell McAdam, CEO could sit on his hands no longer, and told the Wall Street Journal “the match had to occur” and cautioned if the government blocks the merger, it needs to cough up more spectrum for wireless companies like his, and fast.

McAdam made those comments earlier today at an investor conference on the afternoon of the first court hearing on the Department of Justice lawsuit to derail the $39 billion deal.

My Breakfast With Julius

McAdam has the luxury of getting his point across directly with Washington’s movers and shakers.  While consumers continue to clamor in overwhelming numbers against the idea of T-Mobile being absorbed into a super-sized AT&T, McAdam enjoyed breakfast with Federal Communications Commission chairman Julius Genachowski.

Consumers don't have the luxury of breakfast with the chairman of the FCC

“I have taken the position that the AT&T merger with T-Mobile was kind of like gravity,” Mr. McAdam said. “It had to occur, because you had a company with a T-Mobile that had the spectrum but didn’t have the capital to build it out. AT&T needed the spectrum, they didn’t have it in order to take care of their customers, and so that match had to occur.”

“So in my discussions with the FCC and folks on the Hill, if we want to stop or if the government wants to stop a merger like that, they need to then step up and say, this is how we are going to get spectrum in the hands of people,” he said.

Mr. McAdam said that can be done through secondary auctions, incentive options or freeing up additional spectrum. He said the wireless industry needs more spectrum, and the FCC will be “very focused on delivering that.”

McAdam didn’t say T-Mobile could have always sold its unwanted spectrum to AT&T instead of entering into a $39 billion dollar merger deal that will further reduce wireless consumers’ choice in carriers.

Unfortunately, consumers bringing delicious breakfast pastries and a point of view about wireless consolidation are unlikely to find themselves sharing a cup of joe with the head of the FCC.  They can’t even be trusted with the FCC Chairman’s direct phone number, which executives at AT&T and Verizon both have.

No Second Cup of Coffee for Jittery Investors

Investors may not want a cup of coffee themselves, considering the jittery reception some have had to news Verizon would forgo a recurring dividend and spend money at wireless spectrum auctions instead.

“When it makes sense, we’ll have a dividend,” he said. “When there’s a better first use for those dollars, we’ll do that with it, and the dividend will either be on a hiatus or less.”

A lawsuit accusing Verizon of defrauding creditors of Idearc, Inc., Verizon’s telephone directory publisher can proceed to trial, a judge ruled Monday.

U.S. District Judge A. Joe Fish in Dallas denied a request by Verizon’s attorneys to dismiss the suit, which claims Verizon sought to “hinder, delay, or defraud” creditors of its former directory publishing business, spun-off in 2006.

“These detailed and particularized allegations show that Verizon had a motive and opportunity to commit the alleged actual fraudulent transfers, and they permit the court to draw a reasonable inference of Verizon’s intent,” Fish ruled.

Creditors are upset that Verizon may have breached its fiduciary responsibility when it sold off Idearc, keeping nearly $9.5 billion in assets for itself while ultimately leaving the newly-independent publisher insolvent.

Verizon used a legal maneuver called a Reverse Morris Trust that left Idearc with enormous debt, but a tax-free sale for the phone company.  A federal class action lawsuit called that “a massive, Enron-style debt off-loading spin transaction” and accused the company of fraud.

The track record for Verizon’s spinoffs have not been good.  Three of them resulted in quick bankruptcy for Hawaiian Telcom, Idearc, and FairPoint Communications.  The last — a spinoff of landlines to Frontier Communications, has left Frontier with substantial debt.

Idearc filed for bankruptcy in 2009.  In renamed itself SuperMedia in 2010 after exiting bankruptcy proceedings and still does business from its headquarters in Dallas.