Is Verizon slapping the caps on its DSL customers in the northeast?

A handful of New York and New Jersey Verizon customers were surprised to find Verizon suddenly defining usage limits on their DSL service on its website dashboard for existing customers:

• High Speed Internet: Up to .5 – 1 Mbps — 150 GB Usage
• High Speed Internet Enhanced: Up to 3.1 – 7 Mbps — 250 GB Usage

The sudden appearance of data allowances confused some customers, because the only references to them appear on pages for existing customers seeking to change or upgrade their current DSL package, and only in certain sections of upstate New York and New Jersey.

Careful scrutiny of Verizon’s terms and conditions make no reference to the new data caps, although the company declares customers are responsible for all usage charges. There is also no mention of the caps on Verizon’s sales pages for prospective customers, and phone reps didn’t know anything about them either.

Verizon has not indicated what might happen if a customer exceeds that cap or where the caps are being enforced, if anywhere.

We reached out to different Verizon press contacts twice this week to get confirmation and have heard nothing back.

If you are a Verizon DSL customer, do us a favor and let us know in the comment section what you see when you review options to change your DSL service.

Update 7:18pm EDT: Verizon did get back in touch with us after we went to press in response to several questions.

Here is our Q & A with Verizon’s Ray McConville, corporate media relations representative for New York, New Jersey, Connecticut, and FiOS:

Q. Is Verizon setting data allowances on their DSL service plans?

No. We have been conducting a usage billing trial to a very small set of customers in Virginia where we would measure their data use and display it in their billing. While these customers were given the 250 GB and 150 GB allowances you showed in those screen shots, we’ve never billed customers who exceed those allowances and have no plans to do so. The purpose of the trial was more the idea of accurately collecting and displaying usage in billing.

Q. If a customer exceeds that allowance, what happens?

Nothing. Again, we don’t do data caps. We have the small Virginia trial of displaying usage in billing, but it’s still not a cap, and customers aren’t billed for exceeding the 150 or 250 GB numbers.

Q. Is this a new policy?

No. It’s not a policy – we don’t have data caps or overage charges.

Q. In what states or service areas, if any, is this data allowance policy in effect?

Just the small Virginia trial, and customers are not charged for going over the “allowance.”

Q. If that is the case, why are customers in New York and New Jersey seeing the usage allowances?

It’s a likely system error; they should not have seen that. Only customers in the very limited part of Virginia where we have the trial should see such a thing.

Q. What is the status of the trial in Virginia?

Trial is ongoing – not aware of any end point.

Customers hoping New Jersey’s telecom regulator would compel Verizon to expand fiber to the home service across southern New Jersey are out of luck.

The New Jersey Board of Public Utilities (BPU) approved a settlement between Verizon New Jersey, Inc., Cumberland County, and 18 southern New Jersey towns that alleged Verizon failed to properly maintain its wireline network in areas where it has chosen not to deploy FiOS — its fiber to the home service. But the settlement will only compel Verizon to maintain its existing copper network and offer token DSL and FiOS expansion in some unserved rural communities.

“We have heard our customers’ concerns in South Jersey and are pleased to have reached an agreement with the approval of all 17 towns on a maintenance plan going forward,” said Ray McConville, a Verizon spokesman. “We look forward to staying in regular communication with the towns to ensure our customers continue to receive the level of service they expect and deserve.”

“While the Board was fully prepared to proceed on this matter, the parties were able to reach a negotiated settlement which takes into consideration the needs of each community,” said Richard S. Mroz, president, N.J. Board of Public Utilities.

But some residents of those communities beg to differ.

“It’s another example of Chris Christie’s hand-picked regulators letting Verizon off the hook and sticking us in a digital divide,” complained Jeff Franklin, a Verizon DSL customer in Cumberland County. “Verizon should not be allowed to offer one half of the state modern broadband while sticking the rest of us with its slow DSL service.”

Franklin is upset that communities bypassed by Verizon’s FiOS network appear to have little chance of getting it in the future, now that regulators have agreed to allow Verizon to fix its own copper network.

“All the Board did was force Verizon to do what it should have been doing all along, taking care of its own network,” Franklin complained to Stop the Cap! 

Verizon did agree to expand its fiber network into the communities of Estell Manor, Weymouth Township, Corbin City, and Lower Alloways Creek Township, but only because of a 2014 agreement with Verizon compelling them to offer broadband to residents who read and complete a “Bona Fide Retail Request” (BFRR) form which stipulates homes and businesses in Verizon’s New Jersey territory can get broadband if they don’t have it now as long as these criteria are met:

• Have no access to broadband service from a cable provider or Verizon;
• Have no access to 4G-based wireless service; and
• Sign a contract for at least one (1) year of broadband service and pay a $100 deposit.

“BFRR is a joke because it requires potential customers have no access to 4G wireless service,” claimed Franklin. “You have to go to the government’s National Broadband Map to determine eligibility, which is very tough because — surprise, surprise — Verizon itself contributed its 4G wireless coverage information for that map and as far as Verizon is concerned, their 4G coverage in New Jersey is beautiful, even though it really isn’t.”

If a single provider submits map data that shows a home address is already covered by 4G wireless service, even if that isn’t accurate on the ground, that customer is ineligible under the terms of BFRR. Even if they were able to subscribe to 4G broadband, most plans are strictly data capped or throttled.

Under the settlement, Verizon gets to choose what technology to deploy. Outside of the four communities getting FiOS, the rest of South Jersey will have to continue relying on Verizon’s DSL service. Verizon has agreed to extend DSL to 2,000 new residences and businesses in Upper Pittsgrove, Downe, Commercial, Mannington, Pilesgrove, and South Harrison. It will also fix some of its DSL speed congestion problems and monitor for future ones as part of the settlement.

But DSL won’t work if Verizon’s wireline network stays in poor shape. The company has agreed to deploy its “Proactive Preventative Maintenance Tool” (PPMT) to scan its copper network to identify and repair or replace defective cables. Verizon has also agreed to daily inspections of outside facilities and fix any detected problems within 30 days, as well as regularly reporting back on the condition of its infrastructure inside the towns affected under the settlement.

This agreement took a year and a half to reach and will keep the two parties out of court, but many are not satisfied being left with Verizon’s DSL service.

“Unfortunately, the BPU continues to allow Verizon to pick and choose which residents will receive modern telecommunications at an affordable cost,” Greg Facemyer, a Hopewell Township committeeman in Cumberland County, told NewsWorks. “The state legislature needs to recognize these inequities and step in and level the playing field for South Jersey. Otherwise, our region will continue to fall even farther behind and be less competitive.”

When the Berkshire Eagle asked readers to test their internet speeds and share the results, along with opinions about their broadband options, the newspaper hit a nerve.

Over 400 readers in western Massachusetts promptly responded, many with scathing stories about slow speeds and unresponsive customer service.

The newspaper preferred to call it “tortured testimony.”

“It is slow and getting slower,” wrote Bob Rosen, from Otis. “Many times it just says, ‘not responding.'”

“It” is Verizon’s DSL — broadband for the masses of landline customers in Massachusetts unlucky enough not to have FiOS fiber to the home service available before Verizon decided to stop expanding its copper-replacement fiber network. For the last seven years, Verizon’s DSL has remained more or less “as-is,” with no significant service improvements or apparent expansion effort.

Unfortunately, as customer demand for bandwidth grows, performance drops unless providers continually invest in new equipment to manage demand appropriately. Customers in western Massachusetts report Verizon seems to be making do with what they already have, and speeds have suffered.

Douglas Mcnally of Windsor, a member of the Select Board and consultant whose job depends on a good internet connection told the newspaper he really doesn’t have a consistently reliable connection. One test showed a speed of 2.82Mbps, but a second one returned a speed result of 0.64Mbps. Barbara Craft-Reiss from Becket has a connection also topping out at 0.64Mbps.

In Dalton, a customer that repeatedly complained about his 1.5Mbps speed was told that was as good as Verizon DSL was going to get.

“I have had several communications with Verizon and they always say not to expect any more,” the reader told the newspaper. “At times it is so slow the web page expires before it comes up. There are many times it does not work at all.”

Verizon seemed to echo its “done with DSL” attitude to Robert Rosen who has subscribed since the 1990s at his home in the Otis Woodlands area.

“In the beginning, the signal was very strong. Every six months I would call Verizon and see if I could get a stronger signal. Sometimes it was boosted, however in the past several years I have been told by Verizon I am at max strength,” Rosen said.

But at least he could subscribe. Verizon customer service agents have warned some customers if they drop DSL service, they cannot come back. Bob Johnson dropped his 2Mbps Verizon DSL account — the one he inherited under the previous account-holder’s name.

“I was told that if I cancelled the previous owner’s account, I would not be able to get an account at all,” Johnson reported.

A Verizon spokesperson claimed DSL is still available in Verizon’s FiOS-less service areas, as long as the customer’s line passes a loop qualification test. Only ISDN has been decommissioned in certain service areas, the spokesperson claimed.

But Stop the Cap! has heard from countless Verizon customers who share stories of deteriorating performance and disinterest in improving service, and customer service agents won’t even sell DSL to customers without bundling landline phone service.

“They are just letting the old telephone network fall apart piece by piece,” claims John Landis, a Verizon DSL customer outside of Buffalo, N.Y. “The investment is just not clear anymore. When is the last time Verizon introduced a new service on their wired network, such as faster internet speeds? We’re living with a company where time has stopped, unless you are on Verizon Wireless.”

Verizon’s apparent disinterest in selling DSL broadband has proved to be a significant benefit for cable operators that continue to take market share from the phone company. Strategy Analytics reports cable companies added more than three million new subscribers from 2015 on. Cable operators now have a 62% broadband market share, compared to just 15% for DSL, a percentage that has dropped for years. (Fiber broadband now accounts for a 23% share.)

“The telco operators haven’t been able to shake off the losses of DSL subscribers, but we expect to see increased fiber deployments in the coming quarters, which should help AT&T and Verizon return to growth,” Jason Blackwell, director of Strategy Analytics’ Service Provider Strategies Service said last summer. But much of that growth seems to be targeted for urban and suburban areas, not rural areas where DSL is often the only available broadband technology.

Despite telco claims that wireless broadband alternatives will eventually solve the rural broadband problem, Blackwell is skeptical.

“The reality is fixed broadband is continuing to grow in the U.S., and not being replaced by mobile broadband as some have reported,” he claimed. “The cable operators are driving the growth with increased speeds and multiplay bundles.”

The availability of a cable competitor has helped some in western Massachusetts resolve their broadband problems, but only in communities where cable operators exist. Many western Massachusetts residents are still waiting for community-owned gigabit-capable fiber broadband through the WiredWest project.

In late 2015, politics from the governor’s office put a “pause” on all state “last-mile broadband” projects and a sudden policy shift required each town to own its own network infrastructure despite the widely expressed desire on the local level for a regional approach. More than a year later, the project to improve broadband across the western half of the state is still trapped by bureaucratic interference, allowing the state’s big cable and phone companies to continue the status quo with no alternatives on the immediate horizon.

As of late December, the project is gathering support for sending a resolution to state officials reaffirming their request to allow local communities involved in the project to determine their broadband future without onerous requirements from the governor’s office.

Without WiredWest, the future is not good. Unless Verizon changes its mind about broadband deployment in western Massachusetts or cable operators Charter and Comcast spontaneously expand their service areas, readers of the Berkshire Eagle can expect more of what staff writer Larry Parnass summed up in two words: extreme disappointment.

October 20, 2015

Hon. Kathleen H. Burgess
Secretary, Public Service Commission
Three Empire State Plaza
Albany, NY 12223-1350

Dear Ms. Burgess,

New York State’s digital economy is in trouble.

While providers claim portions of New York achieve some of the top broadband speeds in the country, the vast majority of the state has been left behind by cable and phone companies that have never been in a hurry to deliver the top shelf telecom services that New Yorkers need and deserve.

The deregulation policies of the recent past have resulted in entrenched de facto monopoly and duopoly markets with little or no oversight. Those policies, instead of benefiting New Yorkers, are ultimately responsible for allowing two companies to dominate the state’s telecommunications marketplace.

In virtually all of upstate New York, the services consumers receive depend entirely on the business priorities of local incumbent providers, not market forces or customer demand. As a result, New Yorkers face relentless, unchecked rate increases, well-documented abysmal and unresponsive customer service, and inadequate broadband provided by a workforce under siege from downsizing, cost-cutting, and outsourcing.

Certain markets, particularly those in the New York City area, have at least secured a promise of better broadband from Verizon’s FiOS fiber to the home upgrade. But at least 100,000 New Yorkers have languished on Verizon’s “waiting list,” as the company drags its feet on Non Standard Installation orders.[1] In upstate New York, Verizon walked away from its FiOS expansion effort five years ago, leaving only a handful of wealthy suburbs furnished with fiber service while effectively abandoning urban communities like Buffalo and Syracuse with nothing better than Verizon’s outdated DSL, which does not meet the FCC’s minimum definition of broadband – 25Mbps.[2]

Cablevision’s broadband performance dramatically improved because of investment in network upgrades, and the company has been well-regarded for its broadband service ever since.[3] But the proposed new owner of Cablevision – Altice, NV — has sought “cost savings” from cuts totaling $900 million a year, which will almost certainly devastate that provider’s future investments, its engineering and repair crews, and customer service.[4]

At least downstate New York has the prospect for +100Mbps broadband service. In upstate New York, three providers define the broadband landscape for most cities and towns:

• Time Warner Cable dominates upstate New York with its cable broadband service and has the largest market share for High Speed Internet. As of today, Time Warner Cable’s top broadband speed outside of New York City is just 50Mbps, far less than the 1,000Mbps service cities in other states are now on track to receive or are already getting.[5]
• Verizon Communications is the largest ILEC in upstate New York. Outside of its very limited FiOS service areas, customers depend on Verizon’s DSL service at speeds no better than 15Mbps, below the FCC’s minimum speed to qualify as broadband;[6]
• Frontier Communications has acquired FiOS networks from Verizon in Indiana and the Pacific Northwest, and AT&T U-verse in Connecticut. Frontier has made no significant investment or effort to bring FiOS or U-verse into New York State. In fact, in its largest New York service area, Rochester, there are significant areas that can receive no better than 3.1Mbps DSL from Frontier. The vast majority of Frontier customers in New York do not receive service that meets the FCC’s minimum definition of broadband, and some investors predict the company is “headed for financial disaster.”[7]

The competitive markets the DPS staff envisions in its report to the Commission are largely a mirage. When an ILEC like Frontier Communications admits its residential broadband market share “is less than 25% in our 27 states excluding Connecticut,” that is clear evidence the marketplace has rejected Frontier’s legacy DSL service and does not consider the company an effective competitor.[8]

While incumbent cable and phone companies tout ‘robust competition’ for service in New York, if the Commission investigated the market share of Time Warner Cable upstate, it would quickly realize that ‘robust competition’ has been eroding for years, with an ongoing shift away from DSL providers towards cable broadband.[9]

Frontier’s primary market focus is on rural communities where it often enjoys a monopoly and can deliver what we believe to be inadequate service to a captive customer base. The company is currently facing a class action lawsuit in West Virginia, where it is alleged to have failed to provide advertised broadband speeds and delivers poor service.[10]

Verizon’s ongoing investment in its legacy wireline network (and expansion of DSL to serve new customers) has been regularly criticized as woefully inadequate.[11] From all indications, we expect the company will eventually sell its legacy wireline networks, particularly those upstate, within the next 5-10 years as it has done in northern New England (sold to FairPoint Communications) and proposes to do in Texas, California, and Florida.[12] (Verizon also sold off its service areas in Hawaii, West Virginia, and much of its territory acquired from GTE.)

Across New York, service problems and controversial deals between telecom providers have made headlines. Here are just a few:

1. Superstorm Sandy’s impact on Verizon’s legacy wireline network on Fire Island and in other downstate communities left many without service. Instead of repairing the damage, Verizon proposed to scrap its wireline network and substitute inferior wireless service with no possibility of wired broadband.[13] The DPS received a large number of comments from the public and local elected officials fiercely opposed to this proposal, one that Verizon eventually withdrew in the face of overwhelming opposition.[14]
2. There are growing allegations Verizon may be underspending on its legacy wireline network and even worse, may be misallocating costs and revenues to deceive the Commission.[15] Some allege much of the company’s ongoing investments, charged to the wireline operation, in reality are for the benefit of its wireless network. This may have allowed Verizon Communications/New York to claim significant losses on its wireline books the company then argued justified rate increases on ratepayers.[16] A full scale accounting of Verizon’s books is essential for all concerned and corrective action may be necessary if these allegations are proven true.
3. Verizon’s foot-dragging on FiOS buildouts in New York City led to a damning audit report commissioned by New York City Mayor Bill de Blasio this summer and oversight hearings were held last week by the City Council of New York.[17] [18] Despite Verizon’s creative definition of “homes passed,” a substantial number of New Yorkers cannot receive the benefits of “today’s networks” the DPS staff refers to. Instead, many are stuck with poorly-performing DSL or no service at all.[19] Regardless of whether fiber passes in front of, over, in between, or behind buildings, Verizon signed an agreement compelling them to give customers a clear timeline to establish FiOS service. It is apparent Verizon is not meeting its obligations.[20]
4. The proposed sale of Time Warner Cable to Comcast led the Commission’s staff to admit the majority of respondents to requests for public input were strongly opposed to the merger and without substantial modifications concluded would not be in the public interest.[21] Comcast eventually withdrew its proposal in the face of overwhelming opposition.
5. The proposed sale of Time Warner Cable to Charter Communications, where the DPS staff concluded as the application stood, there would be no public interest benefits to the transaction.[22]

Those are just a few examples of why aggressive oversight of telecommunications is critical for all New Yorkers. In most of these examples, the DPS never ruled one way or the other. The companies individually made their own decisions, and we believe they would have decided differently if they did not face grassroots opposition from consumers.

New Yorkers deserve an active DPS prepared to aggressively represent our interests, ready to investigate what Verizon is doing with its legacy wireline network, legacy wired broadband services, FiOS and Verizon Wireless. With Time Warner Cable having such a dominant presence in western and central New York, its sale should never be taken lightly, as it will impact millions of New Yorkers for years to come.

While the DPS seems prepared to passively wait around to discover what Time Warner Cable, Frontier and Verizon are planning next, the rest of the country is getting speed upgrades New York can only dream about.

Google Fiber and AT&T, among others, are aggressively rolling out 1,000Mbps fiber service upgrades in other states, while a disinterested Verizon refuses to invest further in FiOS expansion, leaving millions of New York customers with nothing better than DSL.

The lack of significant competition upstate is why we believe Time Warner Cable has not yet chosen any market in New York except New York City for its Maxx upgrade program, which offers substantially faster speeds and better service.[23] There is no compelling competitive reason for Time Warner to hurry upgrades into areas where they already enjoy a vast market share and no threat of a broadband speed race. So much for robust competition.

Charter’s proposed acquisition of Time Warner Cable proposes a modest upgrade of broadband speeds to 60-100Mbps, but as we wrote in our comments to the DPS regarding the merger proposal, upstate New York would be better off waiting for Time Warner Cable to complete its own Maxx upgrades over what will likely be 100% of its footprint in the next 24-30 months.[24] Time Warner Cable Maxx offers maximum broadband speeds three times faster than what Charter proposes for upstate New York, while also preserving affordable broadband options for those less fortunate. Approving a Charter buyout of Time Warner Cable will only set upstate New York back further.

We confess we were bewildered after reviewing the initial staff assessment of telecommunications services competition in New York. Its conclusions simply do not reflect reality on the ground, particularly in upstate communities.

It was this type of incomplete analysis that allowed New York to fall into the trap of irresponsible deregulation and abdication of oversight that has utterly failed to deliver the promised competition that would check rate hikes, guarantee better customer service, and provide New York with best-in-class service. In reality, we have none of those things. Rates continue to spiral higher, poor customer service continues, and New York has been left behind with sub-standard broadband that achieves no better than 50Mbps speeds in most upstate communities.

This summer, the American Customer Satisfaction Index told us something we already know. Americans dislike their cable company more than any other industry in the nation.[25] A survey of more than 14,000 customers by ACSI found service satisfaction achieving a new all-time low, scoring 63 out of 100.

“Customers expect a lot more than what the companies deliver,” said ACSI managing director David VanAmburg, who called poor customer service from cable operators “endemic.”

This year, Time Warner Cable again scored the worst in the country. As the only cable provider for virtually all of upstate New York, if residents in New York are given a choice between Time Warner Cable and the phone company’s slow-speed DSL, they are still likely to choose Time Warner Cable, but only because they have no other choices for broadband that meets the FCC definition of broadband.

Providers are quick to suggest consumers can turn to so-called competitors like satellite broadband or wireless Internet from mobile providers. They conveniently ignore the fact satellite-delivered Internet is such a provider of last resort, less than 1% of New Yorkers choose this option. Those that have used satellite broadband tell the companies providing it they rarely achieve the claimed speeds and are heavily speed throttled and usage capped.[26] It’s also costly, particularly when measuring the price against its performance.

Mobile Internet, which some ILECs have advocated as a possible replacement for rural wireline networks, is also a very poor substitute for wired Internet access. Wireless broadband pricing is high and usage allowances are low. Attempts to convince New Yorkers to abandon Verizon landline service in favor of Verizon’s 4G LTE wireless replacement have led to consumer complaints after learning their existing unlimited Verizon DSL service would be substituted for a wireless plan starting at $60 a month with a 10GB usage allowance.[27]

A customer with a 6Mbps DSL line from Verizon consuming 30GB of usage a month – hardly a heavy user – pays Verizon $29.99 a month for DSL service during the first year. In contrast, that same customer using Verizon Wireless’ home 2-5Mbps wireless LTE plan will pay $120 a month – four times more, with the added risk of incurring a $10 per gigabyte overlimit fee for usage in excess of their allowance.[28]

None of this information is a secret, yet it seems to have escaped the notice of the DPS staff in its report. Part of the reason why may be the complete lack of public input to help illuminate and counter incumbent providers’ well-financed public and government relations self-praise campaigns. If only actual customers agreed with their conclusions, we’d be well on our way to deregulation-inspired broadband nirvana.

Except New Yorkers do not agree all is well.

Consumer Reports:

Our latest survey of 81,848 customers of home telecommunications services found almost universally low ratings for value across services—especially for TV and Internet. Those who bundled the three services together for a discount still seemed unimpressed with what they were getting for their money. Even WOW and Verizon FiOS, which got high marks for service satisfaction, rated middling or lower for value, and out of 14 providers, nine got the lowest possible value rating.

What is it about home telecommunications that leaves such a sour taste in customers’ mouths? When we asked Consumer Reports’ Facebook followers to tell us their telecom stories, the few happy anecdotes of attentive service technicians and reliable service were overwhelmed by a tidal wave of consumer woe involving high prices, complicated equipment, and terrible service.[29]

The effective competition that would rely on market forces to deter abusive pricing and poor customer service is simply not available in a monopoly/duopoly marketplace. New entrants face enormous start-up costs, particularly provisioning last-mile service.

The nation’s telephone network was first constructed in the early half of the last century by providers guaranteed monopoly status. The cable industry developed during a period where regulators frequently considered operators to be a “natural monopoly,” unable to survive sustained competition.[30] Many cable operators were granted exclusive franchise agreements which helped them present a solid business case to investors to fund a costly network buildout. The end of franchise exclusivity happened years after most cable operators were already well established.

Today, those marketplace protections are unavailable to new entrants who face a variety of hurdles to achieve success. Some are competitive, others are regulatory. Google Fiber, which provides competitive service in states other than New York, publishes a guide for local communities to make them more attractive prospects for future Google Fiber expansion.[31]

For many overbuilders, pole attachment issues, zoning and permitting are significant obstacles to making new service available to residential and commercial customers. New York must ensure pole owners provide timely, non-discriminatory, and reasonable cost access. Permitting and zoning issues should be resolved on similar terms to speed network deployment.

Because a long history of experience tells us it is unreasonable to expect a competing telephone or cable company to enter another provider’s territory, in many cases the only significant possibility for competition will come from a new municipal/co-op/public-owned broadband alternative.

The hurdles these would-be providers face are significant. Incumbent provider opposition can be substantial, especially on a large-scale buildout. In rural areas, incumbents can and do refuse to cooperate, even on projects that seek to prioritize access first to unserved/underserved areas currently bypassed by those incumbents.

The effort to wire the Adirondack Park region is a case in point. Time Warner Cable has refused to provide detailed mapping information about their existing network, making it difficult to assess the viability of a municipal and/or a commercial broadband expansion project into these areas. Time Warner Cable maintains it has exclusivity to granular map data showing existing networks for “competitive reasons,” effectively maintaining an advantageous position from which it can strategically apply for state broadband expansion funding to expand its network using public funds.

Time Warner Cable benefits from access to publicly-owned rights of way and sanctioned easements. Without this access, their network would likely be untenable. As a beneficiary of that public access, making granular map data available to broadband planners is a fair exchange, and nothing precludes Time Warner from building its network into those unserved/underserved areas – something that might deter a would-be competitor’s business argument to overbuild a high-cost, rural area. The Commission should ask itself how many rural New York communities have two (or more) competing cable companies serving the same customers. If the answer is none, Time Warner Cable does not have a valid argument.

There is ample evidence the Commission needs to begin a full and comprehensive review of telecommunications in this state. It must build a factual, evidence-based record on which the Commission can build a case that oversight is needed to guarantee New Yorkers get the high quality telecommunications services they deserve.

Broadband and telephone service is not just a convenience. In September 2015, the Obama Administration declared broadband was now a “core utility,” just as important as telephone, electric, and natural gas service. Isn’t it about time the Department of Public Service oversee it as such?[32]

Respectfully submitted for your consideration,

Phillip M. Dampier

Director, Stop the Cap!

[1] http://stopthecap.com/2015/10/19/n-y-city-council-investigates-verizon-foot-dragging-fios-possible-contract-violations/
[2] http://www.wsj.com/articles/SB10001424052702303410404575151773432729614
[3] https://www.fcc.gov/reports/measuring-broadband-america-2014
[4] http://variety.com/2015/biz/news/altice-group-patrick-drahi-cablevision-bid-1201599986/
[5] http://www.pcmag.com/slideshow/story/310861/if-you-want-gigabit-internet-move-here/1
[6] https://www.fcc.gov/document/fcc-finds-us-broadband-deployment-not-keeping-pace
[7] http://seekingalpha.com/article/2888876-frontier-communications-headed-for-financial-disaster
[8] https://seekingalpha.com/article/2633375-frontier-communications-ftr-ceo-maggie-wilderotter-q3-2014-results-earnings-call-transcript
[9] http://www.leichtmanresearch.com/press/051515release.html
[10] http://www.wvgazettemail.com/article/20141020/GZ01/141029992
[11] http://www.cwa-union.org/news/entry/cwa_calls_for_regulators_to_investigate_verizons_refusal_to_invest_in_landl
[12] http://stopthecap.com/2015/05/05/fla-utility-says-negotiations-with-verizon-make-it-clear-verizon-will-exit-the-wireline-business-within-10-years/
[13] http://money.cnn.com/2013/07/22/technology/verizon-wireless-sandy/
[14] http://documents.dps.ny.gov/public/MatterManagement/CaseMaster.aspx?Mattercaseno=13-C-0197
[15] http://www.cwa-union.org/news/entry/cwa_calls_for_regulators_to_investigate_verizons_refusal_to_invest_in_landl
[16] http://newnetworks.com/publicnn.pdf/
[17] http://www1.nyc.gov/office-of-the-mayor/news/415-15/de-blasio-administration-releases-audit-report-verizon-s-citywide-fios-implementation
[18] http://arstechnica.com/business/2015/10/verizon-tries-to-avoid-building-more-fiber-by-re-defining-the-word-pass/
[19] http://www.nytimes.com/2015/08/27/nyregion/new-york-city-and-verizon-battle-over-fios-service.html?_r=0
[20] http://www.nyc.gov/html/doitt/downloads/pdf/verizon-audit.pdf
[21] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={0A5EAC88-6AB7-4F79-862C-B6C6B6D2E4ED}
[22] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId=%7BC60985CC-BEE8-43A7-84E8-5A4B4D8E0F54%7D
[23] http://www.timewarnercable.com/en/enjoy/better-twc/internet.html
[24] http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={FCB40F67-B91F-4F65-8CCD-66D8C22AF6B1}
[25] http://www.marketwatch.com/story/the-most-hated-cable-company-in-america-is-2015-06-02
[26] https://community.myhughesnet.com/hughesnet?topic_list%5Bsettings%5D%5Btype%5D=problem
[27] http://www.verizon.com/home/highspeedinternet/
[28] HTTPS://www.verizonwireless.com/home-services/lte-internet-installed/
[29] http://www.consumerreports.org//cro/magazine/2014/05/how-to-save-money-on-triple-play-cable-services/index.htm
[30] http://www.citi.columbia.edu/elinoam/articles/Is_Cable_Television_Natural_Monopoly.pdf (p.255)
[31] https://fiber.storage.googleapis.com/legal/googlefibercitychecklist2-24-14.pdf
[32] http://thehill.com/policy/technology/254431-obama-administration-declares-broadband-core-utility-in-report

Sandra Hartman has been a Verizon DSL customer for more than 10 years. She doesn’t have much of a choice.

In her small town outside of Binghamton, N.Y., Verizon is her only option. Time Warner Cable doesn’t come close to providing service in this part of upstate New York and cell service is abominable, even with Verizon and AT&T.

“I live in an area just large enough to have given Verizon the justification to offer DSL, but 3Mbps service is about all we have ever been able to get, but it has been better than nothing,” Hartman tells Stop the Cap!

Hartman signed up for a package that included $19.99 DSL with her landline a decade ago, a price that went up $10 after the sign-up promotion ended but has remained stable for years.

“Then Verizon decided to raise the price without improving the service,” Hartman says.

In fact, the price hikes have been fast and furious lately, beginning last fall when Hartman received this notice Verizon was raising the price to $34.99 a month:

Dear Valued Verizon Customer,

We realize you have choices when it comes to choosing your Broadband provider, and would like to take this opportunity to say thank you for being a loyal customer and for choosing Verizon.

In order to continue to bring you quality service and product innovation, at times we need to raise our rates. Your monthly rate will increase by $5.00 and will be reflected on your bill within the next two months. This rate will remain in effect for one year. If you currently have any credits or discounts on your account, these will remain in effect until their original expiration date.

If you would like to review your account to see if you may qualify for additional savings or if you have any questions, please log on to verizon.com/myverizon or give us a call at 1.888.213.9932.

We value you as a customer and look forward to continuing to serve you.

Sincerely,
Your Verizon Team

“What choices?,” Hartman wondered. “We have no choice and after the rate increase, we’ve seen no improvement in the quality of the service or any evidence of Verizon’s ‘product innovation.’ It’s the same DSL service we’ve had for a decade — we’re just paying $60 more a year for the same thing.”

To save money, Hartman downgraded her Verizon landline to the cheapest possible plan and switched to Voice over IP provider Ooma, which works over her DSL line. But Verizon is now back for more with another rate increase notice — this time looking for another $7 a month starting this fall, putting the price of 3Mbps DSL up to $41.99 before fees, surcharges, and taxes.

“I called Verizon and they told me rates are reviewed ‘for competitive reasons’ and reflect the cost of providing the service, which is apparently now up another $84 a year,” she said. “Verizon’s equipment, sitting in the elements on a phone pole or humming away in their phone office actually appreciates in value it seems. I wish my 10-year-old laptop was worth more today than the day I bought it, but my laptop wasn’t made by Verizon.”

Hartman complained to customer service the successive rate increases do not seem to be spent on any improvements. In fact, it seems Verizon is no longer accepting new DSL customers in her area.

“A real estate agent friend of mine told me selling homes in this town has gotten difficult because Verizon will simply not sell DSL to new customers here, claiming they have no capacity,” Hartman said. “If you can’t get DSL from Verizon, you don’t have broadband service, it’s as simple as that.”

DSL availability from Verizon is not just a problem for Hartman. Several central offices in upstate New York no longer accept new Verizon DSL customers, claiming the service is at capacity. Some customers in the Finger Lakes region keep DSL service year-round at their seasonal cottages, fearing if they suspend service for the winter they will not get it back next spring. Time Warner Cable offers service to many lakefront properties, but those who own cabins and homes away from the lakeshore usually cannot get cable service and depend on Verizon for service.

The Verizon DSL forum on DSL Reports has more examples of customers that discover their entire exchange is no longer qualified to get Verizon DSL. One such example is in Purcellville, Va., west of Washington, D.C., a quick drive to the Maryland and West Virginia borders.

“DSL suddenly has disappeared from my wire center entirely – regardless if your 10 feet from the CO or out of a remote terminal with a DSLAM,” wrote Zenit. “Even the industrial section of town which has its own fiber fed DSL equipped RT shows negative for service, and there are plenty of vacant units there.”

Similar stories were reported in communities like Pittsfield, Mass. and Netcong, N.J.

Customers have been able to push back against Verizon’s price increases, especially in competitive areas. Some customers are switched to lower cost bundled packages while others are given straight service credits that lower a customer’s bill. Customers need only ask Verizon for a better price and let them know you are shopping around for a better deal.