dslreports logo
site
 
    All Forums Hot Topics Gallery
spc

spacer




how-to block ads


Search Topic:
uniqs
107
share rss forum feed

guppy_fish
Premium
join:2003-12-09
Lakeland, FL
kudos:1
Reviews:
·Verizon FiOS

Verizon most certianly can walk-a-way

There is no law stating Verizon for eternity must support POTS, it can simply spin off the asset into a new company and then shutdown the spin off as it spirals into debt and default.

When the net income becomes negative for POTS, that's the nuclear option for Verizon, and there is noting the locals can do to stop it.


elefante72

join:2010-12-03
East Amherst, NY

2 recommendations

Sort of. States and even municipalities created must have contracts which were the remnants off the Bells. But back in those days they had a monopoly and it was vastly profitable. Enter competition, no longer profitable or marginally so.

Now Verizon wants out. Either the states get rid of must carry, or Verizon will marginally support copper or as they are trying to move people over to wireless which is profitable but with also less government oversight.

You can't force a company to maintain a loss leader under the guise of regulation, so something will need to be done and it's not fair anymore for Verizon to take it in the shorts (or any other telco).

Verizons ex was a optical guy, the new one a wireless jockey and that is the way you are going to see capital flow--to wireless which is way more profitable. FIOS is OK since they can offer 3-play, but with bundling killing TV margins and copper POTS, the copper POTS has to go. IT doesn't make sense throwing $$$ at old skool DSL if the profit is minimal or negative and we all know copper is dead.

So either Verizon lets them die, or they come in a do fixed LTE or fixed wireless and can make a buck. From their perspective it is highly preferenential to sell it off because then they can shi**can their pension obligations. Not saying that is right (I dont), but that is REALLY what is driving this....

It would be like the government forcing the road owners to provide a lane for horse and buggy, alongside a 4 lane highway for cars. Every now an again I see Amish chillin on the road, but does that mean the road company should pay millions to have 3 people have their own lane? Nope. POTS is horse and buggy technology.


TBBroadband

join:2012-10-26
Fremont, OH
reply to guppy_fish

Once it's spun off VZ wouldn't be in control any longer. The new company would be. But as a POTS company; the Feds would not allow it to close. But the new company could keep it going.


TBBroadband

join:2012-10-26
Fremont, OH
reply to elefante72

Right. We just entered Maine and was told by their PUC legal staff that they're gutting their regulation on POTs services. It only makes sense. Especially since everything is moving wireless or VoIP.



IowaCowboy
Iowa native
Premium
join:2010-10-16
Springfield, MA
Reviews:
·Verizon Broadban..
·Comcast
reply to guppy_fish

said by guppy_fish:

There is no law stating Verizon for eternity must support POTS, it can simply spin off the asset into a new company and then shutdown the spin off as it spirals into debt and default.

When the net income becomes negative for POTS, that's the nuclear option for Verizon, and there is noting the locals can do to stop it.

Not without regulatory approval. They have to get approval from the FCC and the state DPU to shut down pots.

I think the real reason they're waging a war on fixed line is union labor, in that case they can hire contractors to maintain the fixed line plant (which is widely done in the cable industry).

Fixed line is still profitable, while residential landlines are being cut (which I don't recommend) they're still widely used by government and business users. They are also more secure than Internet connections which is why lottery terminals use them.
--
I've experienced ImOn (when they were McLeod USA), Mediacom, Comcast, and Time Warner and I currently have DirecTV. They are much better than broadcast TV.

I have not and will not cut the cord.

guppy_fish
Premium
join:2003-12-09
Lakeland, FL
kudos:1

No one needs approval to shutdown a company, the worst that can happen is the assets are forfeited. If Verizon is losing money, that's more of a loss than walking away



IowaCowboy
Iowa native
Premium
join:2010-10-16
Springfield, MA
Reviews:
·Verizon Broadban..
·Comcast

Until they are forced to refund (plus interest) the subsidies that the former Ma' Bell received to build the system.

The only reason they haven't hung up on pots is regulatory chokehold. But they are free to hang up on DSL at any time as that is unregulated. But if they do then what little profits they are making off of copper will turn into a liability.

If it keeps making them money they'll keep operating it. In my opinion, I think Miley Cyrus should be dropped from her record label after what she did at the MTV video music awards but as long as she even generates a few hundred iTunes downloads a year the record label will keep her.
--
I've experienced ImOn (when they were McLeod USA), Mediacom, Comcast, and Time Warner and I currently have DirecTV. They are much better than broadcast TV.

I have not and will not cut the cord.


rahvin112

join:2002-05-24
Sandy, UT
reply to guppy_fish

They aren't losing money, it's a regulated service. They are entitled to a fixed profit margin (most utilities are around 10%) and the utility commission will allow rate increases up to that level. In reality the percent is a smidge lower (typically around 6%).

The problem as they see it is they aren't making enough money, not that they are losing money. Part of this is because they highly overvalue the wireline assets to use as collateral against loans. So when you claim the copper plant is worth 300 billion and you are making 0.00001% ROI yea it looks terrible.

Frankly I'll never understand these companies willingness to walk away from money. I know it's tied to the fact that the CEO and board of directors in general have no vested interest in the company beyond the quarterly numbers but this crap is just destroying this country.



tshirt
Premium,MVM
join:2004-07-11
Snohomish, WA
kudos:4
Reviews:
·Comcast
reply to IowaCowboy

said by IowaCowboy:

Until they are forced to refund (plus interest) the subsidies that the former Ma' Bell received to build the system.

That will never ever, ever happen.
if YOU shopped at the same store for 50 years, and then they go out of that business you don't get your money back on everything you purchased.
Those "subsidies weren't gifts, or buying stock, they were Gov't paying for select service discounts and plant additions that otherwise would not have happened in an open market.
That money is gone.

sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1
reply to elefante72

Where's your evidence for your assertion that wireline DSL is a "loss leader"?