Verizon, NYC Settle Lawsuit Over Verizon's Empty Fiber Promises

from the day-late-dollar-short dept

Like AT&T, Frontier, and other U.S. telcos, Verizon has a long, rich history of taking tax breaks, regulatory favors, and taxpayer subsidies in exchange for networks it only half deploys. That was the case in the 90s when Verizon took a several billion tax breaks from the state of Pennsylvania in exchange for networks it never deployed. It was also the case in New York City, where Verizon was sued by the city for promising to deploy fiber universally to all five boroughs, and then, well, not doing that.

In 2017, NYC sued Verizon, stating a 2014 deal to deploy fiber to the entire city fell well short of the full goal. As some local reporters had warned at the time (and were promptly ignored), the city's deal with Verizon contained all manner of loopholes allowing Verizon to wiggle over, under and around its obligations. And wiggle Verizon did; a 2015 city report found huge gaps in deployment coverage -- particularly in many of the less affluent, outer city boroughs.

Last week during the holiday bustle the city quietly announced it had settled its lawsuit with Verizon. Under the confidential settlement, the city claims Verizon will expand fiber deployment to an additional 500,000 low income homes across the city:

"This settlement will make sure that Verizon builds out its fiber footprint more equitably throughout New York City — especially in low-income communities that have historically been underserved by internet service providers,” said DoITT Commissioner and Citywide CIO Jessica Tisch. “This agreement attacks that unfair imbalance, and recognizes that high-quality internet is a necessity, not a luxury."

The problem, as usual, will be in the follow up. The original lawsuit (pdf) stated that Verizon had deployed fiber to 2.2 million out of the city's 3.3 million residences with FiOS, despite the original 2008 agreement with the city calling for "100%" FiOS availability. An additional 500,000 deployed homes sounds good, especially during a pandemic, but it's still a far cry from the company's original promise to the city. The city likely found the lawsuit to be too costly or unwinnable, and with so much else going on, agreed to settle and at least get something for its efforts.

Granted this isn't just some one-off problem. Telecom giants are so politically powerful (on both the state and federal level) that genuine accountability for failed promises is extremely hard to come by. One simply needs to look at the long list of cities and states that have accused the company of taking subsidies and tax breaks then failing to evenly deploy fiber, whether it's Philadelphia or a huge swath of New Jersey. And again, you'll find much the same story having played out with telco giants like AT&T and Frontier Communications from Mississippi to West Virginia.

As we've noted for a long time, policymakers act as if U.S. broadband mediocrity is just something that happens or is due to America just being really, really big. In reality, the reason U.S. broadband is patchy, expensive, with atrocious customer service? Plain old state and federal corruption we often refuse to even acknowledge, much less do anything about.

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Filed Under: broken promises, digital divide, fiber, fios, internet access, new york city, promises, subsidies
Companies: verizon


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  • icon
    Nathan F (profile), 1 Dec 2020 @ 7:13am

    The fact that the terms of the settlement, aside from the requirement of 500k getting wired, is secret tells me that Verizon managed to work in more loopholes to get out of their side of the agreement.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 1 Dec 2020 @ 7:16am

    broadband mediocrity is just something that happens or is due to America just being really, really big.

    Not it isn't, the US can be tucked into a corner of Africa

    reply to this | link to this | view in chronology ]

    • icon
      Samuel Abram (profile), 1 Dec 2020 @ 7:21am

      Re:

      Well, at least the 48 contiguous states.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 1 Dec 2020 @ 7:36am

        Re: Re:

        The Sahara desert is 9,200,00 square km, while the contiguous states are 7,665,00 square km. Alaska adds another 1,718,00 square km, which pushes the US a bit over the size of the Sahara desert.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 17 Dec 2020 @ 12:03pm

          Re: Re: Re:

          Yeah but the USA is a country and Africa is a continent... so your point is that continents are bigger than countries? Which one country in Africa is bigger, by any measurement, than the USA?

          reply to this | link to this | view in chronology ]

    • identicon
      Zonker, 1 Dec 2020 @ 3:51pm

      Re:

      Since we have been able to deliver landline telephone service and electricity to every home in the country we should have had no problem delivering broadband internet service to every home in the country by now.

      Instead we have regulatory capture by natural monopolies operating in an economy that rewards profits above all else.

      reply to this | link to this | view in chronology ]

      • icon
        FeRDNYC (profile), 25 Dec 2020 @ 8:01am

        Re: Re:

        Since we have been able to deliver landline telephone service and electricity to every home in the country we should have had no problem delivering broadband internet service to every home in the country by now.

        Ehhhh... I mean, in fairness, it did take us over 50 years to accomplish that, and it really isn't quite 100% complete even today. It's over 95%, probably, and for the most part people who still lack service do so voluntarily, but still it's not quite there yet.

        Also, if you take electricity as an example, much of that connectivity was achieved via multi-mile-long long stretches of high-tension overhead wire in exactly the way you can't deliver high-speed internet service.

        Don't get me wrong. The fact that telcos today have largely adopted an attitude like they don't want or need new customers (but still deserve to keep raking in the dough all the same), and the palpable contempt they exhibit for the customers they do have, absolutely enrages me. And they could do a LOT more to solve these issues if they found it within themselves to just deign to give a fuck. They are, without question, the problem.

        But that being said, we tend to forget that things like the electrical grid and the POTS network grew gradually and evolutionary, over the course of many decades, and often in tandem with regional development in general. Less than 30 years ago, growing up in Queens, NYC, our neighborhood still had both telephone AND cable TV wiring on overhead poles, right where it'd stood for the previous 4-5 decades. Electrical service had been buried, at one point, but the data services weren't part of that effort and ended up waiting another few decades before they finally went ahead and buried the whole mess. Digging up every road in a borough of NYC is the sort of logistical nightmare you don't undertake lightly, and don't repeat often.

        And that's how you end up with stories of people who can't get broadband service because the fiber required to provide it is buried in the wrong place, or there isn't any buried fiber near their new-construction home, or the telco just doesn't feel like digging up the street for them, or etc.

        The trend toward buried runs as the only method of running fiber (for good reasons), and the trend towards fiber as the only method of delivering sufficiently high-speed broadband, means that it's hard for the network to grow organically from a starting point of just a wire strung along a pole for a few miles. But that's how all of our previous networks started, and how they continued to exist for a LONG time — longer than residential fiber has even been a thing.

        I don't have any good solutions to offer. I don't know if what we need is more point-to-point wireless, more satellite, or what. But I do see the technical and logistical problems, which become especially vexing when they're compounded with the network providers' disinterest.

        reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 1 Dec 2020 @ 11:41am

    oh yeah!

    reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 1 Dec 2020 @ 12:20pm

    WOnderful Capitalistic opportunity.

    I see that the Telecom industry is required to install TONS of fiber.
    As a true capitalist(you can even look this up) I raise my prices.
    Oops there is a Asian competitor, Bitch about Secrets, and internet spying and get them restricted.
    Back to business, and raising prices. Not counting that the USA has the highest material prices, then add only sellers IN the USA.

    Fiber, check
    Converter boxes check
    Interconnects check
    Patching materials check
    Digital relay systems check
    Servers check
    Man power check

    WOW, after you raise all the prices, that Tax reduction really seem abit Low. And the CEO, really doesnt want to take a pay cut for 5 years. How many employees can we lay off?

    reply to this | link to this | view in chronology ]


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