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Verizon CFO now says his Title II comments were taken out of context

Verizon CFO Fran Shammo is claiming that Title II would really hurt their company and that this all was a "misunderstanding."
By
January 26, 2015
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As we have discussed previously, Verizon can’t seem to make up it’s mind about whether to support Title II classification by the Federal Communications Commission (FCC).

On one hand, Verizon proudly claims to be a Title II service when applying for local franchise agreements in New Jersey, Washington DC and other states. This allows Verizon to save billions in tax benefits.

On the other hand Verizon publicly states that classifying them as a Title II service would ruin their company and cause network investment to slow to a crawl.

Yet Verizon’s CFO, Fran Shammo, recently claimed at an investor conference that Title II wouldn’t really decrease their investment since it Title II classification would have “no effect” on how they do business going forward.

VerizonTitleIIDocuments

Now, as the Washington Post reports, Shammo is claiming that Title II would really hurt their company and that this all was a “misunderstanding.”

  • When Fran Shammo previously said that Title classification “does not influence the way we invest,” he really meant that it was “an extreme and risky path.
  • When Fran Shammo previously said that Title II classification meant that Verizon was “going to continue to invest in our networks and our platforms, both in wireless and wireline FiOS and where we need to,” he really meant that it would “jeopardize our investment and the development of innovation in broadband Internet and related services.”

According to Shammo, he was “misquoted by Congress and the media” because he was just talking about 2015.

Let’s get into that. What exactly was Fran Shammo asked at the conference?

John Hodulik – Analyst for UBS North America – “Obviously there’s a lot of commentary coming out of Washington about this move to Title II. Obviously Verizon has been one of the more of a stiffer opponents of any sort of increased regulation, especially on the Wireless side. What’s your view of that potential occurrence down in Washington and does it affect your view on the attractiveness of investing further in the United States?”
Fran Shammo – CFO, Verizon – “I mean to be real clear, I mean this does not influence the way we invest. I mean we’re going to continue to invest in our networks and our platforms, both in Wireless and Wireline FiOS and where we need to….”
John Hodulik – “Makes sense. Okay, I think we have some microphones in the back of the room, if there are any questions from the audience?

Having read over the entire transcript, it is simply bizarre to claim that anything quoted by the media about Shammo’s statement was taken out of context.