Verizon Sued For Overstating FiOSTV Numbers Verizon says they just want out of their ad contract... An advertising company is suing Verizon, saying the telco overstated its FiOSTV numbers. The lawsuit alleges that Verizon committed fraud by improperly including "pending" customers in its published number of subscribers in the New York City region in order to artificially inflate advertising costs. Verizon is still negotiating a TV franchise with the city. "Verizon's fraud in overstating the number of subscribers indisputably meant that purchasers of advertising time were paying for FiOS subscribers who did not exist," the complaint says. "If the assertion is that we overstate our numbers we certainly reject that," says Verizon's Eric Rabe. "This is a garden-variety business dispute initiated by a customer who wants to be released from a contract they agreed to."
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  wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | What crap! How can they be sued over this?? There is nothing wrong with stating the number of pending customers. Those are customers who have (should be at least) already signed up and are awaiting install. For arguments sake, they will be customers within 30 days or less. What a waste of our legal systems resources.......
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я люблю Денди! | |
|  |  AnonProxyProxy of AnonPremium
join:2001-05-12
ß | Re: What crap! If they are not viewing customers, they are not seeing ads, it's actually that simple. | |
| | | Ahrenl
join:2004-10-26
North Andover, MA | Re: What crap! The issue is actually that Verizon should have defined what they meant by "current customer". Obviously if this contract runs through when these customers, who have already signed up, have been added, then Verizon can attempt to charge for them. They just need to make it clear in the contract that, that is what they're doing.
It should be pretty clear cut for the lawyers weather or not this was stated, the gray comes from weather or not it was implied. | |
| | |  SterlingIP Support Tier IIIPremium
join:2003-05-30
Pittsburgh, PA | The problem is that verizon in it's reporting didn't say these are pending they included there numbers in with the active subs, from places that they don't even have the service in yet, none the less people who are just awaiting a installation appointment. | |
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1 edit | I think in a little different way. If i'm the the one paying the advertisement fee, i will definitely consider the number of current subscriber more than including pending, well it's good to know that more people is going to watch my ad (as those pending customers), but i can pay less for the same effect if Verizon stated real current subscriber.
They will be customer.... i know, this kind of idea apply to many other scenario, but not in business, where every $ counts. Just like when bank doing a year end report, they cannot say those pending mortgage customer is their customer yet, because that will give the investor an impression that the bank will have a good earning next fiscal year. | |
| |  tmccann11Who, Me?Premium
join:2001-06-10
Bayonne, NJ | said by wifi4milez: For arguments sake, they will be customers within 30 days or less. What a waste of our legal systems resources....... And you don't take into account that some businesses may buy a 30 day, 2 week or 1 week block of advertising. They are paying for customers that will never even have a chance of seeing their commercials.
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"Good thing the whole innerweb isn't run with those 3.5 hour reboot time taking computers....I imagine hes running Windows Server 2003 with active directory as a domain controller on a Cascio watch." Barky | |
| | | wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | Re: What crap! said by tmccann11:said by wifi4milez: For arguments sake, they will be customers within 30 days or less. What a waste of our legal systems resources....... And you don't take into account that some businesses may buy a 30 day, 2 week or 1 week block of advertising. They are paying for customers that will never even have a chance of seeing their commercials. You make a good point, however lets look at this objectively. If I called X advertising company today, and placed an order the ads would not start running tomorrow. In fact, the process before the ads would go live will likely take up to 30 days, if not more. Given that it is almost unheard of for any consumer broadband install window to be more than 30 days out, the ads would run concurrent with the stated broadband subscribers being live.
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| | | |  sporkmedrop the crantini and move it, sisterPremium,MVM
join:2000-07-01
Morristown, NJ | Re: What crap! said by wifi4milez: In fact, the process before the ads would go live will likely take up to 30 days, if not more. Where did you get that info? I could call up a TV or radio station today and be running my ads tomorrow... | |
| | | | | wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | Re: What crap! said by sporkme:said by wifi4milez: In fact, the process before the ads would go live will likely take up to 30 days, if not more. Where did you get that info? I could call up a TV or radio station today and be running my ads tomorrow... Perhaps on a local station in Bublefork Iowa, yes. Try calling NBC, or even their local affiliate WNBC (here in NYC) and tell them you want to run an ad tomorrow. They will laugh in your face and hang up. What I think a lot of people reading this dont understand is that advertising is bought in advance for a particular time slot. You cant simply call up and say "I want my ad to run tomorrow" as you suggest (the 3am slot doesnt count  ) as someone else has already likely paid for that slot.
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я люблю Денди! | |
| | | | | | | | Re: What crap! You wouldn't call up your local NBC affiliate, you'd call you whoever deals with running local ads in your area (a.k.a, the advetising dept of your local cable company). | |
| | | | | | | wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | Re: What crap! said by retrogame:You wouldn't call up your local NBC affiliate, you'd call you whoever deals with running local ads in your area (a.k.a, the advetising dept of your local cable company). That is incorrect. NBC (and in my case WNBC) is a network, not a cable channel. There is a big difference. If you want to advertise on national NBC or the local affiliate, you contact that office directly to buy advertising. History Channel on the other hand is a channel that is played on cable, and in that case you would contact the advertising department of your local cable company.
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я люблю Денди! | |
| | | | | | | | | | Re: What crap! Cable companies have ad spots that they sell, which is what we're talking about, Verizon selling ad spots.
We're not talking about network affiliates.
We're talking about a cable company selling spots to advertisers and not telling the truth about actual number of subscribers. We're not talking about WNBC selling to advertisers which has nothing to do with Verizon or any other cable company. | |
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| | | | | sporkmedrop the crantini and move it, sisterPremium,MVM
join:2000-07-01
Morristown, NJ | You're confused. Verizon is selling inserts, like the cableco's do.
And you bet your sweet ass WNBC would take your money! | |
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| | |  ieolusSupport The Clecs
join:2001-06-19
Duluth, GA | Kind of grasping at straws, no? | |
| | | | | | said by wifi4milez:You make a good point, however lets look at this objectively. If I called X advertising company today, and placed an order the ads would not start running tomorrow. In fact, the process before the ads would go live will likely take up to 30 days, if not more. What? If you have a commercial already taped and ready for air, any local cable company or TV station will be glad to take your money and start airing your commercial immediately in their unsold commercial slots. Verizon was probably happy to do this as well. | |
| | | | | wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | Re: What crap! said by smcallah:said by wifi4milez:You make a good point, however lets look at this objectively. If I called X advertising company today, and placed an order the ads would not start running tomorrow. In fact, the process before the ads would go live will likely take up to 30 days, if not more. What? If you have a commercial already taped and ready for air, any local cable company or TV station will be glad to take your money and start airing your commercial immediately in their unsold commercial slots. Verizon was probably happy to do this as well. Correct, in their unsold spots. Keep in mind that we are talking about a NYC "television" network here. Most big city networks dont have many prime time slots available for next day running. 99% of the ads my friend placed when at NBC, Telemundo, and even PAX (no I am not kidding!) were for 30 days out. As I said to the other poster, this is NYC not Bumblefork Iowa and it would be close to impossible to get a spot to run tomorrow at a decent time.
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|  KCrimsonPremium
join:2001-02-25
Brooklyn, NY
kudos:1
 ·Verizon FiOS
| I don't have a WSJ account, so I haven't read the whole article, BUT....
The problem for Verizon here is that they have absolutely NO idea what % of their current installs in NYC will subscribe to FiOS TV, and nobody but Verizon (and MAYBE Mayor Bloomberg & his staff according to yesterday's Daily News article) knows when the franchise agreement will get done.
Verizon hasn't signed ANYONE to TV in NYC, they aren't even signing people up for it.
It SOUNDS like the advertising agency found easy prey in Verizon if the projected NYC TV subscribers were included in the base customer list, or if they just included the FiOS NYC internet/phone customers as "TV customers".
BTW - How does the advertising agency get harmed either way? Don't they just pass off the cost of advertising to their clients? I can see them gathering clients for a class action suit, but I don't see the direct harm that was caused by Verizon in this case. | |
| | |  AlakarFacts do not cease to exist when ignored
join:2001-03-23
Milwaukee, WI | Re: What crap! said by KCrimson:BTW - How does the advertising agency get harmed either way? Don't they just pass off the cost of advertising to their clients? I can see them gathering clients for a class action suit, but I don't see the direct harm that was caused by Verizon in this case. It cuts into their profits. Advertising contracts are exactly that, contracts. You can't go back and say the costs increased now so were passing it on to you.
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"Necessity is the plea for every infringement of human freedom; it is the arguments of tyrants; it is the creed of slaves." William Pitt the Younger | |
| | |  jester121Premium
join:2003-08-09
Lake Zurich, IL | LOL yeah, companies love when you call them up and tell them you're passing on costs to them, I'm sure their customers will be thrilled to just take it up the ass.
The FIOS apologists are almost as thick as the Comcast bashers around here... | |
| | | | KCrimsonPremium
join:2001-02-25
Brooklyn, NY
kudos:1 Reviews:
·Verizon FiOS
| Re: What crap! Do you know how to read? I asked a question! I didn't make any apologies for Verizon.
Ever hear of a sliding-scale for fees?
I've encountered them in other industries, and since I never professed to being in the advertising field, I do not know if such a thing exists in advertising. Keep your attitude in check. | |
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| |  Aggie DanStop... Reverse That.Premium
join:2001-01-30
Frisco, TX | said by KCrimson:The problem for Verizon here is that they have absolutely NO idea what % of their current installs in NYC will subscribe to FiOS TV, and nobody but Verizon (and MAYBE Mayor Bloomberg & his staff according to yesterday's Daily News article) knows when the franchise agreement will get done. Actually, it is trivial to run two reports at Verizon showing the number of FIOS customers and the percentage that have FIOSTV. Take an average of the existing region or of the entire company and project the number of potential subs.
Trust me when I say this happens EVERY DAY with FIOS.
The percentage of FIOSTV to FIOS data customer would hold true once you get to a statistically substantial pool. And a little hint... They'd BOTH be using pending numbers. Which isn't a problem since the trend (or overall percentage) would be the same.
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Note : The statements made by myself are my own and not the opinions of my employer or of my coworkers. 15.81 GHz Crunching Power | My Random Thoughts... Yes, I have thoughts. | |
| | | | KCrimsonPremium
join:2001-02-25
Brooklyn, NY
kudos:1 Reviews:
·Verizon FiOS
| Re: What crap! There is no pool to reference. There are exactly zero TV subscribers in NYC, and zero "pending" TV subscribers. I don't think they can draw data from other regions, as the demographics of the NYC market is pretty unique (at least my neighbors look pretty unique!)  | |
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|  CableToolPoorly Representing MYSELF.Premium
join:2004-11-12 | In simple sales a commision will not be paid if there is no connect.
In the cable world you will not pay a door to door sales guy for sales he made that day. He will get paid when they are installed.
So if you sell service to 30 people in a day but only 18 actually go through with the install should he get paid for 30?
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CableTechs.org/"Horrible People with Integrity" | |
| | | wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | Re: What crap! said by CableTool:In simple sales a commision will not be paid if there is no connect. In the cable world you will not pay a door to door sales guy for sales he made that day. He will get paid when they are installed. So if you sell service to 30 people in a day but only 18 actually go through with the install should he get paid for 30? I dont disagree with you. However, the vast majority of the people who signed up for FIOS TV will let it install. In fact, I would be willing to bet the number of people who order the service, and then cancel it before install is less than 5%. Realistically you have a greater chance of someone cancelling existing services than cancelling a new install.
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| | | | CableToolPoorly Representing MYSELF.Premium
join:2004-11-12 | Re: What crap! said by wifi4milez:said by CableTool:In simple sales a commision will not be paid if there is no connect. In the cable world you will not pay a door to door sales guy for sales he made that day. He will get paid when they are installed. So if you sell service to 30 people in a day but only 18 actually go through with the install should he get paid for 30? I dont disagree with you. However, the vast majority of the people who signed up for FIOS TV will let it install. In fact, I would be willing to bet the number of people who order the service, and then cancel it before install is less than 5%. Realistically you have a greater chance of someone cancelling existing services than cancelling a new install. Well, advertisers with advertising dollars dont like to "bet"
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CableTechs.org/"Horrible People with Integrity" | |
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|  jsimmonsPremium,MVM
join:2000-04-24
Falls Church, VA
 ·Cox HSI
| Doesn't surprise me. I continually get mailings from Verizon extolling the virtues of FIOS, bundling TV, Phone, and Internet, and soliciting me to subscribe. LOL, I've been waiting for them to deliver FIOS into my neighborhood for over 3 years now (Since they advertised availability on Falls Church) and still no infrastructure in my neighborhood.
Not sure why they are wasting their advertising $$ on people like me who can't even get the service if they wanted to.
Maybe they need it to increase their (pending) subscriber numbers thereby boosting their ad revenue. 
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"Everything should be made as simple as possible, but not one bit simpler."- Albert Einstein | |
| |  JeepMattC'mon the UPremium
join:2001-12-28
Wilmington, DE
kudos:2
·Verizon FiOS
| Re: Doesn't surprise me. They're probably mad b/c VZ doesn't show ANY "local commercials" at all - at least on the Delaware system.
So if they're advertising that way, they better subtract all of us!
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"ONE team - ONE city - ONE dream!!" | |
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 av8r7I'd Rather Be FlyingPremium
join:2002-06-14
Boca Raton, FL | what about the other side...
Does Verizon remove customers from their count when they have been notified, "at the end of this billing cycle, please cancel my service"?
These are not customers (even though they currently have service) in the same manner that pending accounts are customers.
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If I am not for myself, Who will be for me? If I am only for myself, What am I? If not now, When? -- Hillel | |
|  La LunaSurvived AshrafulPremium
join:2001-07-12
Warwick, NY
kudos:3 | Is this..... ...the same Verizon that just sued Vonage over sketchy "patent infringement" claims?
Shoe's on the other foot now. pffft...... | |
| | | | Re: Is this..... Whats next? Being sued for the restroom being out of TP? lmao | |
| | | | | Re: Is this..... The poorly placed statement in the article about VZs NYC franchise is confusing the issue. The NY market includes all the subscribers in VHO5 (ie, LI, Westchester, Rockland) and all of those in the NY DMA portion of VHO7 (Northern NJ).
The problem that the claimant has is that VZ is providing pending install numbers (ie, orders taken) and counting them as active subs. Without knowing the numbers, the claimant's premise - that the numbers provided do not equate with the numbers of new subs added - could possibly be explained by factoring in those dropping the service. But it could be that VZ is simply trying to pump the numbers up.
Advertising rates are set on historical data about viewership - when they do the sweeps, they don't take the measurements and then say, the national growth rate for the population is X, so we'll add that to the measured viewership.
In the programming contracts, which also require accurate sub counts, there are formulas: take the total subscribers at the first and last day of the month, add them together, and divide by 2.
That approach should apply whether you are determining the number of viewers for licensing fees, or for advertising rates.
VZ outsources all of the advertising sales to a third party, who should know exactly how to count eyeballs. It is interesting that they were not mentioned in the excerpts I saw. | |
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| |  What does it mean?
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| | | What is meant by advertising on FIOS TV? Where are these ads shown? Is it the same as regular tv ads? Are tv ads the same on Cablevision or satellite TV at all times? Does not advertising on tv go through the channel and not the provider? | |
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