Unions Want Verizon Investigated For Neglecting Taxpayer-Funded Broadband Networks, But Nobody Cares

from the ill-communication dept

Labor unions would like it very much if somebody would investigate Verizon for its neglect of the company's aging DSL lines. As we've noted previously, both AT&T and Verizon are busy trying to walk away from aging DSL lines they no longer want to focus instead on profitable (read: usage capped) wireless. The problem historically has been that both companies have received billions in tax breaks and subsidies to not only build and support DSL, but to upgrade those lines to fiber. Instead, in case after case, we've shown how Verizon simply took the money and then convinced state lawmakers to forget about the obligation.

Last week, the Communications Workers of America (CWA) wrote letters to six state regulatory agencies and the FCC, urging somebody to launch an investigation into Verizon's "neglect" of its DSL customers. According to the CWA, Verizon's own filings suggest the telco spent "just" $200 million to maintain its copper network in eleven states and DC over the last seven years. Basically, argues the union, Verizon DSL customers pay an arm and a leg for barely-adequate service Verizon can't be bothered to maintain (or repair very quickly when it breaks) because they no longer care about these users:
"Across the Verizon landline footprint, residential and single-line business customers pay between $300 and $370 a year for basic voice service and about $400 a year for DSL service. Even using our conservative calculations, Verizon spends less than one percent of the rate it charges for basic voice service and less than half a percent of the rate it charges for a voice/DSL bundled service on the upkeep of its copper network."
And while the CWA is only looking after its own interests here (it's currently negotiating a new contract and is using community angst for leverage), the union is absolutely correct. For years, Verizon has been literally trying to drive these paying customers away with the clever one-two punch of apathy and rate hikes. Elsewhere, Verizon employees have been complaining for years that they aren't given the tools necessary to do their jobs in these unwanted areas. Classier still, Verizon has consistently been using natural disasters like Sandy as cover, simply refusing to repair storm-damaged customers, telling them wireless service (usually very expensive if it's even available) will have to be good enough.

Basically, Verizon's letting millions of DSL users rot on the vine. If these users don't flee on their own accord, Verizon ultimately sells them to a rotating crop of sucker smaller telcos with disproportional appetites and negligible talent for acquisitions, who (usually thanks to complicated Reverse Morris Trust deals) take on so much debt in the transactions that they won't be able to upgrade these lines for years to come (and in several instances have stumbled into bankruptcy).

Here's the thing the CWA doesn't get: nobody in state or federal government cares about any of this. Nobody cares that Verizon promised both Pennslyvania and New Jersey symmetrical fiber for all in exchange for subsidies and tax cuts, then walked away from the promises. Nobody in state or federal government cares that Verizon promised to deploy fiber to all of New York City in exchange for a lucrative franchise agreement, only to balk at the obligation. Sure, local communities care that Verizon has a long, rich history of ripping off taxpayers and leaving work unfinished, but both the federal and state governments have shown repeatedly, consistently and indisputably that they really couldn't care less about Verizon's penchant for fraud.

And here's the rub: even if you were to see a significant audit and investigation of Verizon, in many instances you'd technically find that the telco adhered to the law. And that's quite often because companies like AT&T and Verizon have so much political power they're literally able to change the law after the fact (much like they did when their role in wholesale NSA spying was revealed). Verizon convinced both Pennsylvania and New Jersey to simply look the other way when Verizon took state taxpayers for a ride, and now Verizon's kindly asking many states to look the other way while it neglects millions of taxpayer-subsidized DSL lines. And, loyal to the last, state and federal government are happy to oblige.
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Filed Under: broadband, dsl, fiber, investment, labor unions, taxpayers, unions, wireless
Companies: verizon

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  1. identicon
    TDR, 10 Sep 2015 @ 5:54am

    And this is why corporation and state need to be separated. Forcibly, if need be. And corporations not allowed to grow beyond a certain size before automatic breakup.

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