It's a good bet that at least some of the people who read this live in areas that have the privilege of being hooked up to a fiber network, like Verizon's FIOS service or the equivalent for AT&T. If you are, consider yourself lucky. You now have more choices for telephone, Internet and cable TV than do most Americans.
Wall Street has taken notice of Verizon's FIOS program, as Business Week recently tossed bouquets in the direction of beleaguered Verizon CEO Ivan Seidenberg. Verizon is making money from its fiber investment as more customers are signing up for expensive video services.
That's fine. Companies making money is a good thing. However, what Business Week didn't point out is that there is a flip side to the fiber deployment that could limit consumer choice down the road. The apparent dirty secret about the fiber is that once you get on, there's no going back to the good old copper lines that connected homes for years and for which new technologies are being developed every day.
Here's why it's important. Under current Federal Communications Commission (FCC) rules, the telephone companies have to let competitors buy access to the copper lines. A company like Cavalier in the East, for example, can offer a cheaper and competitive telephone and Internet service to many houses because it can gain access to the copper, even if that access comes at a steep price.
The FCC, in its finite wisdom, however, has ruled that the telephone companies don't have to give competitors access to fiber. As tough as it is for competitors to get a foothold now, it would be impossible to reach customers for the foreseeable future. "Our business plan would be decimated," Cavalier Telephone Chairman Brad Evans told a House of Representatives subcommittee earlier this week.
Verizon did its best to cloud the issue at that hearing. At a hearing of the House Telecommunications and Internet Subcommittee, Verizon Executive Vice President Tom Tauke (a former member of Congress from Iowa who served on the subcommittee) was asked by Chairman Ed Markey (D-MA) about the Japanese policy of keeping copper wire in service, while Verizon discontinues the use of the copper network when it connects a customer to the FIOS, fiber-based service.
Tauke replied that, "The fact is we don't disable copper loops. We have not disabled copper loops to any home to which we have extended fiber." At another point in the hearing, Tauke told the subcommittee: "If the customer wants the copper or wants another carrier to use copper, we put that copper back in."
I am a recent convert to FIOS. We decided to get the service after our Comcast Internet service sped along at twice the speed of our old 56 k modem. So when I called Verizon during the hearing, I was seen on the company's records as a FIOS customer. I called twice, to speak to two different customer service representatives. I asked each one, if I were dissatisfied with the FIOS, how would I go back to a copper connection? Each time I got the same answer. I can't.
One Verizon employee told me, "That's policy and procedures. Once you go on fiber, you have to stay on fiber." Another said that the fiber service was so expensive to install, the company wouldn't let customers go back to copper.
Perhaps there is some room for interpretation here. Verizon may not "disable" the copper lines to your house. Then again, you wouldn't be allowed to use them again, either. And it's not just you. Whoever buys the house later on would be stuck with your decision to go to fiber.
If this weren't bad enough, Verizon is now asking the FCC to lift the regulations that require it to share the copper wire in Boston, New York, Philadelphia, Pittsburgh, Providence, and Virginia Beach. (For the record, other companies are asking for that also. It's not any better when they do it.)
The telephone industry behind the scenes is waging a couple of heavy-duty lobbying campaigns on Capitol Hill. One is to make sure they can't be sued over their spying on American citizens. The other is to continue the moratorium on taxes for Internet access that expires at the end of October. Lawsuits over the spying could cost the companies big money, and without the moratorium, telephone (and cable) companies would have to pass through the new tax, which would be the equivalent of a rate increase.
Add in the petitions to be exempted from regulation at the FCC, mix in Verizon's challenge to the only consumer-friendly parts of a big FCC order setting up a spectrum auction, and the scope of the agenda is fairly clear.
So, what do we, the American public, get out of the industry's agenda? Not much. In fact, it's just the opposite. We have seen in recent weeks Verizon's blocking of text messages from NARAL Pro-Choice America and AT&T's censoring of Eddie Vedder at a Pearl Jam concert. There's nothing to prevent those types of incidents from happening again as companies exercise undue control over what people say.
It's time for policymakers to balance the scales. If Verizon and AT&T and other companies deploy fiber, and if that fiber circumvents the supposed national goal of giving consumers more choices for telephone and Internet service, then requiring the phone companies to allow competitors access to the fiber is one way to start. Another way would be to require non-discriminatory Internet, cellular, data and texting services.
The FCC has already been spanked by the Government Accountability Office (GAO) for being too friendly with industry. . Congress has given the telephone and cable industry a lot over the years. It should be our turn now.
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