dslreports logo

story category
Verizon Tries (Fails) to Defend New DSL Fee
'New costs developed' to cover sagging landline revenue?
by Karl Bode 09:09AM Tuesday Aug 22 2006
We were the first to mention last week that Verizon was ditching the FUSF fee (since they're no longer being charged it themselves), but replaced it with the suspect "supplier surcharge", leaving customers paying roughly the same. "I think it's a sad joke," David Bookbinder of Peabody tells the Boston Globe. "Apparently Verizon saw the elimination of the federal Universal Service Fund charge as an opportunity to sneak in another price increase. They figured the customer wouldn't complain too vehemently since the price to them is about the same."

Coverage at LA Times, Marketwatch, and the Associated Press has Verizon trying to justify the new fee, and doing a rather poor job at it. According to Verizon spokesperson Bobby Henson, these are "new costs that we've developed over the past year as we've been developing and delivering this standalone DSL service. That service doesn't have the benefit of the revenue that was coming in from voice.''

Call us crazy, but it sounds to us like she just admitted the fee was pulled out of thin air to cover sagging landline revenue. Blaming standalone (aka naked) DSL is a nice touch, but we find it hard to believe the development and delivery of a simple copper pair put enough of a strain on their R&D department to warrant a new fee. by the way, Verizon naked DSL still has limited availability, and Verizon has lagged on delivery not because it's hard or expensive to deliver as they claim, but because it cannibalizes on already hurting landline sales.

We've been over this before, so we'll let Techdirt handle it this time: "For any normal business, if your basic costs go up, you simply increase the prices you charge. You don't add in some random meaningless and totally unexplained "fee" to cover those costs. Unless, of course, you're trying to pretend you keep lowering prices so that you can claim to lawmakers that there really is competition in a market where there is very little."

64 comments .. click to read

Recommended comments



2 recommendations

Verizon may cause AIDS&Cancer but it's OK they have FIOS

I have seen people berated mercilessly in these forums for questions that were not ,shall we say,overwhelmingly pro-Verizon.
There is a scary amount of people that think FIOS is so important,so necessary and so revolutionary that Verizon should be allowed to do whatever they want without any question or restrictions,just because they have the fastest internet speeds.
We have already seen how Verizon treats it's customers, local government,the federal government,the competiton,small babies,etc,.
To allow them to proceed towards their goal of monopoly is madness.Their almost intolerably duplicitous behavior is almost sure to get worse,if that is actually possible.

Tavistock NJ

4 recommendations

reply to apollo80

Re: Thought better of Verizon until now...

I agree that Verizon is off base here. Creating a bogus made up fee instead of just raising their rates is deceptive. I am for free market, unregulated businesses and Verizon should be able to raise rates as they see fit. But they shouldn't try to hide an increase in a line item that is not tied to some government mandated tax like they imply by the name they chose.
Join Red Room Forum
BLOG tkjunkmail.blogspot.com
My Web Page