A group of more than two dozen elected officials and community advocates came together in the Western New York today to oppose a secretive new deal being cooked up by Verizon subsidiary Verizon Wireless and some of the nation’s biggest cable companies that would lead to higher prices, slower service, and fewer options for Capital Region consumers. This group of elected officials and other leaders, including Erie County Executive Mark Poloncarz filed comments opposing the deal today with the Federal Communications Commission (FCC), which has authority to reject the deal. Verizon Wireless, Comcast and Time Warner are attempting to create an unchecked monopoly to exclusively sell and market each other’s products. This proposed corporate alliance — if approved by the FCC and the Department of Justice — would limit competition, raise prices, kill jobs and lead more and more consumers to buy their cable, home phone, internet and cell phone service from a single monopoly provider.
“In today’s economy, having access to affordable high-speed internet is as important for success – for communities and individuals – as having electricity,” said New York State Assemblymember Sean Ryan. “If the Federal Communications Commission approves of Verizon’s new scheme with cable companies, fiber-optic technology might never come to Buffalo or the other towns in Erie County that have been passed over, and neither would real competition. We only need to look at Time Warner’s recent dispute with MSG Network over Sabres games to see how well lack of cable competition works the people of Erie County – it doesn’t. The FCC must ensure that Verizon builds FiOS through Verizon’s entire service area to create cable competition and jobs. This deal creates collusion, not competition.”
The proposed deal has two parts. Verizon Wireless and major cable companies will jointly market each other’s products allowing them to offer a “quadruple play” of video, internet access, voice and wireless service that would eliminate competition. Verizon Wireless would also pay $3.9 billion to buy large segments of the wireless spectrum from Comcast, Time Warner, and Bright House Networks, resulting in a an excessive concentration of public spectrum in the hands of only a few corporate players.
“This type of agreement is not in the best interest of those who need to get and stay connected the most: low income communities and families. This is a step backwards in bridging the digital divide, and builds an additional barrier. Television and internet access are tools for learning in our community. Often not affordable at home, computer centers at the library, church, synagogue, or mosque provide access to the world for students and parents alike. We urge Verizon to do what’s right and stop denying the city and its residents to full access to the broadband technology of the future,” said Jim Anderson, Vice President of Citizen Action of New York.
Congressman Brian Higgins submitted a separate letter to the FCC about the proposed plan. In it, he stated, “Verizon specifically has expanded its FiOS network to ten suburbs of the Buffalo area but has not built into our urban neighborhoods. This situation has created an unbalanced market for cable and broadband services in the City of Buffalo with little competition. A merger between CellCo and Verizon could continue this trend rather than alleviate concerns.” The Congressman went on to add, “When the private market places barriers to access or competition fails to produce outcomes that serve the greatest number of people we can only conclude that steps must be taken to alleviate those impediments.
The proposed deal would also deter any expansion of Verizon’s high-speed fiber-optic FiOS network, killing significant numbers of jobs. FiOS is available in several of Buffalo’s suburbs, but Verizon has not made its service available in the City of Buffalo. . Median household income in the ten localities where Verizon has received video franchises for its FiOS service is $56,925, almost twice the median household income of the city of Buffalo at $29,285. Almost half (44.9 percent) of the residents of the city of Buffalo are African-American or Latino, compared to only 4.9 percent of residents in the ten localities that Verizon chose for FiOS. As is the case in many northeastern and upstate New York cities, Verizon has created a digital divide that puts people of color and low-income communities at a disadvantage as education, economic development and access to critical services increasingly depend on access to a high-speed internet connection.
Verizon Wireless and the cable companies are refusing to come clean about the details of the deal. Even as the FCC and Department of Justice review it, large portions of the deal have been redacted, preventing an analysis of the deal’s real impact. As opposition to the proposed deal grows across the country, tens of thousands of consumers have voiced their opposition to this corporate collusion, by signing a petition urging the FCC to reject the deal between Verizon, Comcast and Time Warner.