Op-ed: Verizon willfully driving DSL users into the arms of cable
14 replies, posted
[quote=Ars Techinica]
Back in April, you may recall that Verizon stopped selling standalone DSL, taking us back to the stone age of broadband when users were forced to bundle a costly landline they might no longer want. That move was just one part of a broader tactical shift by Verizon aimed at completely re-configuring the American broadband landscape—potentially for the worse. With FiOS expansion frozen and most of the company's focus on fixed and mobile LTE services with sky-high overages, Verizon has all but declared that the 35-45 percent of their entire customer footprint that will be left on DSL is essentially expendable. Those users are consciously being driven to LTE and cable competitors as part of one of the largest shifts in power and technology this industry has ever seen.
Verizon has numerous reasons for wanting its DSL services to die off, including the fact that newer LTE technology is cheaper to deploy in rural areas and easier to keep upgraded. But one of the driving forces is that Verizon is eager to eliminate unions from the equation, given that Verizon Wireless is non-union. None of this is theory; in fact, it has been made very clear by Verizon executives.
[B]"Every place we have FiOS, we are going to kill the copper," Verizon CEO Lowell McAdam recently told attendees of an investor conference. "We are going to just take it out of service. Areas that are more rural and more sparsely populated, we have got LTE built that will handle all of those services and so we are going to cut the copper off there."
In other words, Verizon will cut off copper in FiOS markets first (which makes sense given the lower maintenance costs of fiber). They'll then leave users in DSL-only markets un-upgraded, forcing them to buy a costly landline so that remaining on Verizon DSL becomes less attractive. Those customers will flee to the same cable companies with which Verizon just signed a massive new partnership, with Verizon planning to sell those users more expensive LTE connections later. Verizon will continue to "compete" in FiOS areas for now, if you call winking and nodding when it's time to raise prices competition.[/B]
Rural areas could see the biggest impact from the shift, as Verizon pulls DSL and instead sells those users LTE services at a high price point ($15 per gigabyte overages). Verizon then hopes to sell those users cap-gobbling video services via its upcoming Redbox streaming video joint venture. Expect there to be plenty of gaps where rural users suddenly lose landline and DSL connectivity but can't get LTE. With Verizon and AT&T having killed off regulatory oversight in most states, you can expect nothing to be done about it—despite both companies having been given billions in subsidies over the years to get those users online.
The entire amazing transition becomes clearer still when looking at Verizon's quarterly earnings posted last week. The company added a whopping 3.2 million LTE users during the second quarter, a record for the telco. In contrast, thanks to a frozen FiOS expansion (with the exception of franchise obligations in urban markets) and their disdain for DSL, Verizon managed to add only a net 2,000 broadband users in the quarter, despite adding 134,000 FiOS users. Verizon CFO Fran Shammo gave several excuses during the investor conference call, ranging from the economy to aardvarks—but the reality is that DSL users are fleeing in droves, and Verizon wants them to go.
It's all an ingenious play by Verizon, though it will have a massive competitive and connectivity impact on the US broadband market that will be studied for decades. What's most amazing is that nobody (analysts, regulators, or the press) seems to have really noticed what Verizon is up to: turning a massive swath of the country from a marginally competitive duopoly with union labor into an even less competitive and more expensive cable and telco non-unionized cooperative monopoly.
The FCC is rumored to be ready to approve the deal, suggesting the agency is either completely and painfully oblivious to what Verizon is actually up to, or is just fine with Verizon's plan. Whether or not you like what Verizon is up to, you have to acknowledge that it's a massive power shift in the industry. Unfortunately for you, if you're a Verizon DSL user—particularly a more rural one—you're going to find yourself an expendable part of the equation.[/quote]
[url=http://arstechnica.com/tech-policy/2012/07/op-ed-verizon-willfully-driving-dsl-users-into-the-arms-of-cable/]Source[/url].
I wonder if the deal with Xfinity has anything to do with this radical decision.
So basically the FCC is completely OK with a monopoly forming under their oversight, something that they're supposed to prevent as a federal agency. Wow.
[QUOTE=Madman_Andre;36946454]So basically the FCC is completely OK with a monopoly forming under their oversight, something that they're supposed to prevent as a federal agency. Wow.[/QUOTE]
Monopolies are good in some cases. For example, if there were two companies that could provide your running water, and you wanted to switch from one to the other, your old company would have to remove all of their pipes they installed and cut you from the service, while the other one would have to install their own pipes and hook you up to their service. Its just easier if one company runs that business.
And to my understanding, it seems like this is just forcing them to upgrade from something that is less efficient than what they have now.
[QUOTE=RIPBILLYMAYS;36946766]Monopolies are good in some cases. For example, if there were two companies that could provide your running water, and you wanted to switch from one to the other, your old company would have to remove all of their pipes they installed and cut you from the service, while the other one would have to install their own pipes and hook you up to their service. Its just easier if one company runs that business.
[/QUOTE]
How is that good? That seems pretty shady to me.
[QUOTE=Fangz;36946816]How is that good? That seems pretty shady to me.[/QUOTE]
Localized monopolies are pretty much needed in terms of basic services such as power and water.
It would be a logistical and economic nightmare if there were several water companies sprouting up in one city to compete for your business.
Fiberoptic as a standard need to be met in the USA. Having a monopoly is bad, but one on a local level under verizon is better than having it under comcast or AT & T.
[QUOTE=Nikota;36947334]Fiberoptic as a standard need to be met in the USA. Having a monopoly is bad, but one on a local level under verizon is better than having it under comcast or AT & T.[/QUOTE]
Comcast recently bought own Verizon.
[QUOTE=Fangz;36947625]Comcast recently bought own Verizon.[/QUOTE]
What are you trying to say here? Comcast is a smaller company than Verizon as a whole, how could they have bought them, the only thing saying that they have any sort of connection is that they purchase things from each other for resale or redistribution.
This move is actually very beneficial to the consumer, fios lines are much more cost efficient and easily maintainable, not to mention the price for the consumer is great for the speed. Basically if fios is available you either have wireless lte, or fios, no more middle ground.
[QUOTE=deadoon;36947946]What are you trying to say here? Comcast is a smaller company than Verizon as a whole, how could they have bought them, the only thing saying that they have any sort of connection is that they purchase things from each other for resale or redistribution.
This move is actually very beneficial to the consumer, fios lines are much more cost efficient and easily maintainable, not to mention the price for the consumer is great for the speed.[/QUOTE]
-snip-
[QUOTE=Fangz;36948002]If you read the article they are removing the FIOS lines.[/QUOTE]
Fios isn't copper...
[url]http://en.wikipedia.org/wiki/Verizon_FiOS[/url]
I've got Verizon DSL. If I could afford anything else I'd switch because if it rains I lose internet.
[QUOTE=RIPBILLYMAYS;36946766]Monopolies are good in some cases. For example, if there were two companies that could provide your running water, and you wanted to switch from one to the other, your old company would have to remove all of their pipes they installed and cut you from the service, while the other one would have to install their own pipes and hook you up to their service.[/QUOTE]
... That's not how it works.
Public water pipes to homes, city takes a small payment from the company for using the public pipes.
What you suggested is the dumbest method I could come up with, unless you count the second company telling the new customer to come get his water with a water tank from their water treatment plant.
Another possibility is that the home-owner owns the pipes on his property, but the general pipes are owned by the city.
[QUOTE=deadoon;36948178]Fios isn't copper...
[url]http://en.wikipedia.org/wiki/Verizon_FiOS[/url][/QUOTE]
My bad, I misread.
[QUOTE=RIPBILLYMAYS;36946766]Monopolies are good in some cases. For example, if there were two companies that could provide your running water, and you wanted to switch from one to the other, your old company would have to remove all of their pipes they installed and cut you from the service, while the other one would have to install their own pipes and hook you up to their service. Its just easier if one company runs that business.
And to my understanding, it seems like this is just forcing them to upgrade from something that is less efficient than what they have now.[/QUOTE]
THIS IS A HORRIBLE REASON TO LET ONE COMPANY HAVE A MONOPOLY IN HUNDREDS OF MARKETS
[QUOTE=jordguitar;36949170]THIS IS A HORRIBLE REASON TO LET ONE COMPANY HAVE A MONOPOLY IN HUNDREDS OF MARKETS[/QUOTE]
WHY ARE YOU SHOUTING
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