In 1993, Verizon signed an agreement with New Jersey that provided the company with near $13 billion in subsidies and tax cuts in exchange for a promise to wire all of the state with 45 Mbps fixed-line broadband by 2010. Although the New Jersey State Board of Public Utilities said in 2012 that Verizon did not make good on its promise, the BPU recently voted unanimously on a settlement that allowed Verizon to say that using wireless-based LTE technology is suitable to deliver broadband to customers that can’t be served by copper-based DSL or its fiber to the home service.
Residents who happen to live in areas not served by cable or wireless broadband can petition Verizon for service, but can only get broadband if at least 35 people in a single census tract each agree to sign contracts for a minimum of one year and pay $100 deposits.
Therefore, Verizon does not have to provide broadband service to customers who Verizon feels would lower their maximum amount of profit. Of course, Verizon gladly accepted all subsidies and tax cuts when the deal was signed in 1993.
Verizon customers using LTE as their sole broadband provider have can expect a life of expensive plans, low data caps and average-at-best service. If you go to Verizon’s web-site and try to buy a new Samsung Galaxy S5, you are presented with the following plans to select:
According to Ars Technica, Verizon mobilized a large swath of concerned citizens that supported Verizon’s case. The only problem was that few if any of these citizens ever existed. Ars Technica reports that at least 792 form comments were submitted on Verizon’s behalf over a couple weeks. Ars Technica picked a number of e-mail addresses from the list and found many of them to be invalid addresses and even a Verizon customer who had no clue that he had sent a message of any kind in support of Verizon:
“I am a customer only to Verizon and I was not contacted by them to submit anything,” the person told Ars. “If they did, I would’ve slammed them. They are gougers. If AT&T was where I lived, I would switch in a heartbeat. That would mean someone did it on my behalf. I can assure you that I did not send that response.”
Stop The Cap also tried to contact the supposed Verizon supporters and found that of the 150 e-mail addresses they tried, many were invalid and others were either Verizon employees or retired Verizon employees including a lawyer who represents Verizon and did not disclose it.
But does this type of action by Verizon really surprise anyone?
In 1994, the state of Pennsylvania and Verizon struck a landmark deal with the state of Pennsylvania. The deal provided Verizon with substantial financial incentives if they met certain broadband rollout criteria. It’s estimated that those financial incentives over the years totaled around $2.1 billion dollars.
As part of that agreement, by 2015, broadband would be run throughout the state to the majority of Verizon’s customers with speeds of 45MB/s symmetrical fiber service right to the door of homes and businesses. By March 28, 2002, the Pennsylvania PUC acknowledged that Verizon was completely ignoring the agreement while keeping all financial incentives.