NYC Sues Verizon For Breaking Promise To Make FiOS Available To All Residents (washingtonpost.com)

New submitter erickessler writes: 1 million NYC homes can't get Verizon FiOS, so the city just sued Verizon. Verizon wants another four years to cover remaining 1 million households. Washington Post reports: "New York City has sued Verizon, saying the phone giant broke its 2008 promise (PDF) to make its Fios cable service available to all city residents. The city said in a lawsuit (PDF) Monday that Verizon missed a 2014 deadline to extend wire by every home or apartment building in the city -- in technical parlance, "passing" the home. The city also argues that Verizon hasn't installed service for thousands who requested it. Verizon disagrees with the city's definition of "passing" a home and says it has done its job. Spokesman Ray McConville said Monday that Verizon sees "passed" as meaning that it can reach every home, provided a landlord gives permission. Verizon wants to reach some buildings through other buildings. In a letter to the city Friday, Verizon says 2.2 million households have access to Fios, a phone, cable and high-speed internet network. Verizon said Monday that it is committed to expanding Fios availability to the city's remaining 1 million households."

Comments

No worries

[lucm]

Marissa is coming, she will fix Verizon like she fixed Yahoo.

They won't come into my building

[Anonymous Coward]

I talked to the techs about it when they were repairing my POTS copper recently. Corporate figures it's not worth their while as the building's too small and other tenants are already with Time Warner, who renamed themselves Spectre excuse me Spectrum. Heard some horror stories about the local low income high rises getting their FiOS boxes and then residents, some of whom use their net connection for health monitors and are on fixed incomes, being told - FiOS or nothing, here's your much larger bill.

Dealt with their techs a lot over the last couple of years, Sandy for one thing, and the techs are uniformly cool and mostly competent. But Verizon corporate does not intend to put FiOS anywhere they can't make an immediate buck. Then they'll claim that the super won't let them in or something which in my case is nuts as I'm the super.

Re:They won't come into my building

[Anonymous Coward]

Please, please, follow up on this. Your testimony will be very valuable.

Re:They won't come into my building

[AHuxley]

Years of experience with poor areas have provided a lot of understanding of how different areas of the USA react to upgraded networks.

In wealthy areas residents apply for new plans.
In poor areas local residents fill a shopping cart with new network hardware and plan the best way to push the full cart to a scrap merchant.

Until an area has undergone full gentrification existing networks stay in place.

Re:They won't come into my building

[Frobnicator]

It just happens because the competency to make something else happen simply isn't there.

I'm curious, what is "something else" when it comes to the most basic problem: the cost of property.

The value of property has ALWAYS gone up near hubs and nice areas. If there was a medieval castle or city walls offering protections and nice things, people flock to it driving up prices. More wealthy people displace less wealthy people, and soon enough all the poorest people are living outside the city walls.

Today city centers get more costly and soon only the most wealthy can live in the valuable core. Poor people are displaced, and people start cries of "gentrification". Nice areas have people invest more time and effort and money into making the areas nice, property values go up, and the consequences follow. On the flip side, poor areas where people cannot invest time and effort and money into making the areas nice, it quickly degenerates, so property values go down.

In all the cases, the land value goes up and the cost of things on that land go up. The natural consequences are that people who cannot afford it are displaced. People who used to own the land can take their profits, but if they're buying new property they have a steep barrier. For the areas where property values go down, people who have less are able to go there, so you quickly get slums. Since they don't have time/money/effort to bring the slums up to a nice high quality, they remain low value.

So far there are no good alternatives to make something else happen as you put it. There have been a few attempts at things like rent-controlled apartments or city-run projects, but they are doomed to fail because the fundamental problem of property value. Subsidizing a few people in high-cost places won't bring back poor people. Fixing one or two buildings in an poor neighborhood can sometimes improve property values enough to turn it around, but usually cities won't make that big of an investment.

Re:They won't come into my building

[MightyYar]

So far there are no good alternatives to make something else happen as you put it.

Singapore does a pretty nice job of it. The government "owns" something like 85% of the housing - but they offer 90-year leases. So the government has fine-grained control over pricing and distribution of rent, but since the people buy and sell leases just like property the human psychological mechanisms at play with property ownership and investment kick in. At first, you might balk at the idea of government-as-landlord... but in most of the West we have property taxes which amounts to pretty much the same thing.

Other cities have different methods - in NYC they famously require certain percentages of new developments to be low-income housing.

The point is that you need to keep the pot stirred and limit the ability of moneyed people to flee, rather than solve, problems.

Re:They won't come into my building

[green1]

Heard some horror stories about the local low income high rises getting their FiOS boxes and then residents, some of whom use their net connection for health monitors and are on fixed incomes, being told - FiOS or nothing, here's your much larger bill.

This is where FiOS is a bit confusing to me. Where I live the main telco is going and replacing as much copper as they can with fibre. But that doesn't mean increased bills, only increased capabilities. The telco is selling the service level, not the technology it's on.
For example, If you're on 25 meg internet on xDSL, and switch to 25 meg internet on fibre, your bill stays the same. The only difference is that while 25 meg might have been the highest speed you could get on the xDSL, you now have the option to upgrade to a 250meg symetrical connection on fibre if you want (and are willing to pay the extra for a connection that's 10 times the speed you had before)

In fact, when you call in for service, you don't even get to chose which technology you get, the telco does, you simply say you want X service tier, and they provide it using whichever technology they have available.

But the reason for this is clear, while there is a large up front cost to installing the fibre network, it benefits the Telco in a bunch of ways, first of all there's the increased revenue from the people who do want the higher speed, but beyond that, there's also the fact that the fibre network is far more reliable and requires less maintenance in the future.

So why on earth is Verizon charging different amounts for the same service on different technology? (oh wait... USA... Monopoly... Capitalism... Shareholders.... rah rah rah)

Define your terms, Verizon.

[buss_error]

Verizon said Monday that it is committed to expanding Fios availability to the city's remaining 1 million households.
Fine. What does that mean in terms of Who, What, Where, When, and How?
Because "in the sweet bye and bye" in terms of the "When" element isn't really acceptable. You've had since 2014, and it's now 2017. Where were you in 2014, and where are you now? And "passing by" a domicile isn't really helpful if persons in it wish to, you know, use fiber.

Anyway, this is really a non-issue. Regulation/Oversight==bad for business as far as the current administration believes. At this rate, I'm just tickled my milk doesn't have melamine in it or my meat isn't horse meat or my prescription medication isn't just powered lead.

Yet, anyway. Who knows what it'll be when the FDA is closed as has been promised.

Re:Open the floodgates

[bill_mcgonigle]

The telcos took billions and billions of dollars of tax money in exchange for upgrades they have no intention of ever providing. Fuck them all. The FCC obviously won't be doing anything now, so it's up to the courts, the only sane branch of government left.

Seriously, if the courts were going to enforce any of this it would have been fifteen years ago. Bless his heart, Bruce Kushnick will not let this go, but the telcos used the government to fleece the "ratepayers" and they have no intention of allowing that government to claw any of it back. Whomever needs to be paid, it's a lot cheaper than building infrastructure.

Meanwhile, regulations prevent any effective competition, so that's as good as you're going to get without an Administrative State revolution.

Re: The real problem seems obvious

[MightyMartian]

We are indeed at that stage of civilization where "played one on TV" is counted as related experience.

Not a promise, a contract.

[Gravis Zero]

Verizon had signed a contract with the city and failed to hold up their end of the contract. Naturally, there are provisions for what happens in this case.

15. DEFAULT AND REMEDIES

15.1. Defaults. In the event of any breach, default, failure or other noncompliance by
the Franchisee in the performance of any obligation of the Franchisee under this Agreement
(each such breach, default, failure or other noncompliance being referred to herein as a
“Default”), which Default is not cured within the specific cure period provided for in this
Agreement (or if no specific cure period is provided for in this Agreement then within the cure
period described in Section 15.3 below), then the City may:

  15.1.1. cause a withdrawal from the cash Security Fund, pursuant to the provisions of Section 15.11 herein;
  15.1.2. make a demand upon the Performance Bond pursuant to the provisions of Section 15.9 herein;
  15.1.3. draw down on the Letter of Credit pursuant to the provisions of Section 15.10 herein;
  15.1.4. pursue any rights the City may have under the Guaranty;
  15.1.5. seek and/or pursue money damages from the Franchisee as compensation for such Default;
  15.1.6. seek to restrain by injunction the continuation of the Default; and/or
  15.1.7. pursue any other remedy permitted by law, or in equity, or as set forth in this Agreement, provided however the City shall only have the right to terminate this Agreement upon the occurrence of a Revocation Default (defined hereinafter).

I'm pretty sure Verizon is going to claim they are blameless in court per the Rules of Acquisition..

#17 "A contract is a contract is a contract... but only between Ferengi."

Re:Upstate

[Anonymous Coward]

That is not how verizon works.

Verizon is broken into a few dozen 'verticals'.

Very true.

Very few of them work together.

Not quite true. Some staff within the various "verticals" want to work with staff in the other "verticals", but issues like government regulations, pricing, and the always dreaded "internal politics" & "management attitudes" can stymie (delay) or even halt any attempt in that company to "work across the verticals".

All of the money for building out residential is funding the wireless verticals.

Actually it is the other way around. Revenues from wireless have been traditionally "funneled" back into the corporate coffers for use elsewhere in the business. The traditional telecom business (aka "wireline"), and FiOS is a part of that "vertical", has been a "break even at best" operation for quite a number of years now. With the ongoing "flattening out" of the revenue "curve" in the overall wireless industry, the days of VZ Wireless giving loads of money to corporate every year may be coming to a close, or at least the revenues from wireless contributed to comporate may decrease. Expect to see some interesting staffing changes (reductions, layoffs) at wireless by the end of 2017 or 2018, so I hear.

Unless the current CEO leaves nothing will change.

It's worse than just the CEO; the CEO's "head is in the clouds" and detached from reality. Most of the very top level management (execs, EVP, SVP, AVP) at Verizon are part of the problem, not part of the solution; they focus more on the "bottom line" of their part of the business and not the "bigger picture". Nobody at Verizon in top level management is looking at "the bigger picture", just the "bottom lines" & other numbers. Look at the boondoggle they got into with the proposed purchase of Yahoo. There may be no way out of that boondoggle. Marissa Mayer is getting her "golden parachute" in the deal, around 24M USD or so I hear, along with a number of "C" level Yahoo execs.

One of the biggest problems that Verizon executives have is a lack of understanding regarding the "various tools in their toolbox" and how to use them like a conductor conducts a symphony orchestra. Huh? They don't understand how to truly integrate all of the differently "parts & pieces", or "verticals" if you wish, that make up the company. They let the "verticals" all run in their own separate directions, and even within the "verticals" some groups "do their own thing"; there is no "team work" but they sure do talk about it alot. Ok, they try to de-duplicate a number of staff positions by consolidating those positions into "corporate overhead", but the Verizon execs lack "the vision" to see what could possible if they conducted the corporation like a symphony instead of a pack of cats, and with my deepest apologies to cats.

They are quickly offloading everything with a wire hanging off it to put wireless in its place.

They are trying to put the genie back in the bottle. The wireline ROI is flat to no growth.

Quite true.

Wireless on the otherhand is growing.

Actually that statement is false. Revenue growth in the wireless "vertical" at Verizon is flattening out. There is slow but steady "device growth" still taking place, but ask yourself this: "How many wireless devices do you really need? Do you have time to manage all of them? Would it not make your life easier if you could consolidate the number of wireless devices you have down to just the number that you really need?"

Why do you think Verizon is laying off employees? They do it quietly (5000+ people in 2015 alone from across most of the "verticals", but did you hear about it or hear the actual numbers involved?). The headhunting & outplacement companies all know about it and no one company could handle "the load" from Verizon in 2015.

Why to you think Veri

Is this the right approach?

[backslashdot]

Is this really the right approach? I get that Verizon used taxpayer funds and government brute force to obtain their state sponsored monopolistic market dominance. But then, how would suing them achieve anything? This lawsuit will result in them writing a fat check to Blasio rather than them actually rolling out fiber to anyone. If you want fiber grab your metamucil new yorkers because this isn't the way to get it.

Re:In Soviet New York...

[mi]

they can look at individual apartment buildings and decide that the demographic living in that building is too poor, or too likely to chose the competition

Well, that would seem like a perfectly normal line of reasoning — why sue them over it?

But I doubt, that's the full reason. In the suburbs of NYC they are perfectly willing to hook-up individual standalone houses — a proposition that seems costlier, than wiring even a small share (like 10%) of apartments in a building. They are willing compete with other providers too. Indeed, my monthly FiOS fee is the same today as it was 6 years ago, but the throughput is up from 35Mbps up/down to 75Mbps — because they are well aware of the "introductory offers" I am getting from Comcast.

So, why are they willing to "leave the money on the table" in NYC? I think, this story indicates, there is no money on the table there — that the city's regulatory climate is so suffocating, only the highest-paying customers get served. This explanation would be consistent with what we already know about the culpability of local governments for the dearth of Internet-service options, and with Google Fiber's unwillingness to touch NYC and other large (hence corrupt) cities with a 10-feet pole...