New York PSC Approves Verizon Voice Link Plans on Interim Basis

Fire Island residents will go without landline service for now, a move the New York State Public Service Commission sanctioned on an interim basis Thursday. These technology and regulatory changes come in the wake of Superstorm Sandy, which last year wiped out much of Verizon’s copper on the western half of the popular New York vacation spot and prompted the telco’s fixed-wireless restoration strategy. Officials and groups such as the Fire Island Association are still negotiating how the telco will deliver service to the island and the impact the change will have on businesses, families and the municipal government. The New York attorney general’s office, Communications Workers of America and others questioned Verizon’s proposal in filings before the PSC this week.

This month, Verizon lobbied for permission from state regulators to ignore damaged copper on the island’s western half and instead transition customers to low-cost, fixed-wireless alternative Voice Link, which will include a device in customers’ homes to map their locations and battery backup power. The telco hopes to transition customers on bad copper to Voice Link nationwide -- a move inspiring some skepticism despite Verizon’s strong advocacy (CD May 13 p9). Verizon described Voice Link as good for consumers and business and said it’s in the midst of educating people about how it works. Fire Island is the first deployment. “The capital costs that Verizon would incur for the installation and connection of new landline facilities -- whether copper or fiber -- in the western portion of the Island would be extremely high, amounting to $4.8 million for a voice-only digital loop carrier system comparable to the network serving the eastern part of the Island,” Verizon said in a Friday PSC filing (http://bit.ly/14hU86e), adding that a fiber network would cost more than $6 million. “In contrast, deploying Voice Link is expected to cost approximately $500,000.” The company will likely earn $200,000 a year from the network, a number likely to decline, it added.

The PSC’s approval of Voice Link isn’t final, regulators said. The PSC plans to seek comments on the technology and service plans and wants Verizon to give the PSC a comprehensive report on Voice Link’s service and reliability by Nov. 1. Verizon recently created a section of its website (http://vz.to/17XTwEZ) to showcase Voice Link, offering diagrams, maps and answers to Fire Island residents about how it'll affect them during disasters and otherwise. It invites residents and businesses to call and get connected. The telco would need to receive PSC approval before expanding this Voice Link substitute for landline service to other areas, the PSC said.

"We're really a test case,” Fire Island Association President Suzy Goldhirsch told us, expressing satisfaction with the PSC’s decision. The association has spent weeks negotiating with Verizon and other state entities in what she described at the start of this week as “a very delicate negotiating position with Verizon.” She appreciates that the PSC approved the tariff, maintaining regulation of the service, while also making the approval “provisional,” she said.

Negotiation has been ongoing. “I'm a government agency,” Steven Brautigam, administrator of Fire Island’s Ocean Beach village, told us. “I must have landlines or there’s big trouble. The village cannot function without these landlines.” The municipality has seemingly solved that problem, Brautigam said. He and other officials stressed that point about five weeks ago when meeting with Verizon and hearing its presentation on Voice Link, he said. Verizon’s May PSC filing specified it would repair copper to serve certain municipal buildings and provide traditional landlines, as Fire Island officials had requested. Brautigam identified two big perspectives on the Fire Island proposal. From the perspective of municipal services, including medical and public safety, “I guess I don’t have a big problem,” he said, noting these institutions will now, apparently, be served by Verizon with landlines.

But Fire Island residents are still plowing through Voice Link implications, Brautigam said. One issue, which national union and public interest critics flagged earlier this month, revolves around Voice Link’s lack of Internet or DSL capability. “This is causing a big problem,” Brautigam said, noting the Fire Island Association is “dwelling on this quite specifically.” He said the issue “hasn’t been addressed to anyone’s satisfaction.” Brautigam pointed to all the restaurants and their reliance on credit cards. The island also has a “lot of dead spots” in terms of wireless, he said, although noting that Verizon pledged to boost the service. Alternatives to Voice Link that do offer Internet services tend to be “very expensive,” he said. Verizon Senior Vice President Tom Maguire, a passionate defender of the new alternative, had suggested satellite as one option. Verizon never suggested the service would offer more than voice, he said. Fire Island lacks any cable competitors.

Verizon raises “valid points” about discontinuing landline service on Fire Island, but the PSC should examine the telco’s claims, New York Assistant Attorney General Keith Gordon told the PSC Wednesday (http://bit.ly/10IddeO). The PSC needs to dig in on Voice Link’s susceptibility to storms and other differences: “The Commission should weigh whether it is reasonable to charge the same amount for Voice Link service that lacks so many valuable features included in the traditional landline rates.” He questioned the proposal’s broader focus: “As drafted, the proposal is not sufficiently developed to clearly outline when such a change would be warranted ... We strongly recommend that the Commission take action on Verizon’s proposal only after a full record has been compiled, with reasonable opportunity for public input and interested parties to examine Verizon’s factual assertions.” The Public Utility Law Project of New York supports the office of the attorney general in opposing summary action on the Verizon proposal, it told the PSC (http://bit.ly/18NI001). Any landline substitution should be “narrowly limited in geographic scope” and be “temporary, pending further scrutiny,” it added. CWA opposes Verizon’s filing, Vice President Chris Shelton told the PSC (http://bit.ly/13p1rXg). He identified several potential issues with Voice Link, pointing to considerations of public safety, carrier-of-last-resort obligations, service quality and availability, and cost of data services. CWA criticized the short notice Verizon gave in its proposal on “broad, generic rules that go to the core of its obligation to serve.”

The Fire Island village of Saltaire criticized Verizon’s request for expedited PSC approval of Voice Link. “But the fact is that this ‘Voice Link’ system has not yet been implemented and is not operational,” Saltaire Mayor Bob Cox told the New York State PSC in a letter last Friday (http://bit.ly/11z2UQC). Cox asked the PSC for time and said any approval of the proposal must be temporary and conditioned on meeting Verizon service quality standards. Cox wanted to ensure that “we, representing the end-users and as an aggrieved party with an active complaint on file with the PSC, be actively involved in that determination,” he said. Suffolk County Legislature Rep. Tom Barraga (R) told the PSC to “postpone your decision to ensure the safety of the residents, visitors, and business owners of Fire Island,” in a Thursday filing (http://bit.ly/12EgX2A). Fire Island is a part of Suffolk County.

"We still have erratic service here in Saltaire,” Cox told us by email. “We have been very involved with Verizon as we seek restoration of this essential service.” In his letter to the PSC, he stressed communities’ needs: “Dial tone service lies at the heart of our essential municipal services capabilities, including our fire, ambulance and public safety resources. Of course this isn’t meant to ignore the serious disruption and inconvenience to our residents and commercial businesses."

Tourist season is gearing up, just as Verizon welcomes Fire Island residents to arrange Voice Link installations. “In the next month, everyone’s going to open up their home,” Brautigam said. “That’s when it’s going to really explode.” Verizon had asked Brautigam to allow a Verizon tent to showcase the service, which he has permitted. Not many have received Voice Link yet, he added. Ocean Beach resident Louis Barash, in Tuesday comments to the PSC (http://bit.ly/12e00LS), questioned why Verizon waited until tourist season, which it used as justification for the switch and the potential inconvenience of replacing copper: “Fundamentally, if Verizon claims the reason for expedition is to avoid inconvenience to customers, it ought to be for the customers, not Verizon, to decide if the inconvenience of one summer of repairs and less than ideal service is greater than the inconvenience of a permanent end to wired service on parts of the Island.”