Untangling Verizon's Doublespeak Explaining How New Fees Replace Old Fees

from the let's-try-that-again dept

Verizon and the other telcos have a long history of misleading doublespeak when they try to explain their actions -- and we have yet another example today. Earlier, we mentioned how Verizon seemed to be taking its pricing cues from The Onion, with their decision to add in a new "supplier surcharge" that almost exactly matches the Universal Service Fund fees that they are no longer required to charge customers as of the end of this month. It's been shown by a few observers recently that the Universal Service Fund basically just goes right into the coffers of the telcos, and does plenty to hold back universal service than to encourage it -- so perhaps it's no surprise that the telcos would simply tack on a new meaningless fee to replace the old one. They have a long history of hiding price increases behind made up fees -- so in this case, they're simply replacing the USF fees with their own made up fee, that has even fewer restrictions (i.e., none, as opposed to very little) on how the fee money is used.

However, where the story gets really good is in Verizon's explanation for the new fees. While claiming it's just a shocking coincidence that the fees almost exactly match the amounts of the dearly departed USF fees, a spokesperson claims: "new costs that we've developed over the past year as we've been developing and delivering this standalone DSL service. That service doesn't have the benefit of the revenue that was coming in from voice." It's not at all clear what that means. She says the company "developed" new costs, which makes it sound like it purposely came up with these new costs. At the same time, she references the standalone DSL product, which Verizon has resisted rolling out for some time, even though there's been pretty strong demand. The idea that it should add additional costs to offer DSL without a phone line seems pretty silly -- especially since others have done it for years. What the quote is really saying is that Verizon is still upset that its traditional voice line business is in trouble, but Verizon can't admit it publicly as it would cause investors to beat down the stock. For any normal business, if your basic costs go up, you simply increase the prices you charge. You don't add in some random meaningless and totally unexplained "fee" to cover those costs. Unless, of course, you're trying to pretend you keep lowering prices so that you can claim to lawmakers that there really is competition in a market where there is very little. If that's the case, you need to keep adding in fake fees to raise revenue, while pretending that the "competition" is forcing you to lower prices. And, what better way to sneak in a fee than to replicate nearly the exact dollar amount of the fee the government no longer requires you to collect -- and then just sending it directly to your own coffers?

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  1. identicon
    Anonymous Coward, 22 Aug 2006 @ 6:14am

    Yeah, everyone wants a 'piece of the action'.

    That's ok - I know NOT to go with Verizon at least.

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