In Pennsylvania, Verizon's idea of competition is: they win

by DAN TUNNELL, Harrisburg Patriot-News

Verizon Communications and other traditional phone companies have been busy lobbying members of the state Legislature to pass a bill that would effectively allow phone companies to bypass local municipal leaders and well-established nondiscrimination laws in their quest to offer cable television services -- all under the guise of promoting competition.

Competition is generally a good thing for consumers; however, when one actually studies the effects of Verizon's demands, it becomes clear that we might be headed down a dangerous path where only the wealthy are served, while low-income, minority and rural areas are left behind.

Verizon claims it would like to offer video (or cable) services to all residents of Pennsylvania. However, they are asking for major concessions from the state to loosen regulations, remove oversight and eliminate a level playing field in their quest to compete with the cable companies. It appears that their idea of competition is: They win.

Currently in Pennsylvania, both state and federal laws require cable companies to negotiate franchise agreements with individual municipalities before they can enter a market and offer services.

These agreements ensure important input from local leaders while also providing them with the authority to require that within a reasonable period of time all customers -- in every neighborhood regardless of socio-economic status -- receive service.

These nondiscrimination provisions prevent a company from selecting only high-end, wealthy customers while ignoring low- and middle-income customers, or rural areas.

But now Verizon wants to eliminate these nondiscrimination laws and remove local oversight and local citizen input. Its answer: Replace local decision-making with a state bureaucracy.

Although the bill calls for "oversight" by a state agency, even the state's authority is emasculated. In reality, the legislation provides for no oversight, thereby allowing the phone company to effectively pick and choose which customers will have access to their services. Local leaders will be left with no voice to protect residents, and many local citizens will be left without the services.

Verizon has argued that the current system of obtaining local input is antiquated and too burdensome.

However, Verizon's CEO told Wall Street that his company has never been denied a franchise where they have sought one.

The real reason the process is burdensome is that Verizon refuses to even talk to some communities.

In central Pennsylvania, 33 municipalities in Dauphin, Cumberland, Perry and York counties contacted Verizon nearly a year ago, but Verizon did not even have the courtesy to respond to them. Yet the company has the temerity to tell legislators that local officials and local citizens are a barrier to entry! What nonsense.

To date, the traditional Bells nationwide have announced plans to deploy fiber to roughly 570 American towns and cities -- virtually all of them more affluent suburban communities.

In fact, more than 90 percent of the communities the phone companies have targeted for video services are above the national median income. In Pennsylvania specifically, Verizon has targeted about 200 communities for cable TV competition. Of those, about 83 percent are above the state median income. The rural parts of the state are virtually ignored.

It is clear that absent any state requirement or nondiscrimination provision, access to competitive services for all Pennsylvania residents will not be guaranteed. In addition to violating a basic principle of fairness, selective access will have a profoundly negative impact on productivity and educational growth, thus aggravating the digital divide.

The phone companies should be encouraged to enter the broadband market by local officials. In fact, they have not been turned down for any franchise that they have sought in our state to date.

Yet they continue to propagate this fantasy that local decision-making is somehow inhibiting their progress. Because they failed to make the necessary investments in true broadband networks, they are now seeking a state bailout from their poor business decisions.

However, they should be held accountable for their past ineptness. All members of the Keep It Local PA Coalition ( urge our legislators to resist the siren song of a company that once again is seeking a state bailout.

Don't trample the rights of our local citizens by sending this important decision-making process to the state bureaucracy. And please don't leave any local citizens behind.

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Verizon disputed that charge. The carrier has invested $8.5 billion in infrastructure in Pennsylvania over the past 10 years, and competition is thriving in the state, said company spokeswoman Sharon Shaffer. Local governments that get into the broadband business risk pouring taxpayer dollars into projects that don't pay off, Shaffer said. In addition, they enjoy competitive advantages that include having access to public funds and not having to pay taxes, she added.

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