New Jersey Fiber Optic Broadband Scandal

New Jersey Fiber Optic Broadband Scandal

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Background

In 1993, Verizon New Jersey made commitments to replace the aging utility wires with fiber optic lines that were capable of 45 Mbps in both directions and  literally 100% of the state should have been rewired by  2010. Called “Opportunity New Jersey”, (ONJ), state laws were changed  to give Verizon billions of dollars to upgrade what is commonly known as the “PSTN”, Public Switched Telephone Networks to a fabulous fiber optic future.

Instead of creating the first fully-fiberized state, (as Verizon called it), NJ Verizon customers paid about $3000-$4000.00 for a fiber optic service they never got, not to mention lower cable, phone, internet and broadband prices because of competition. That comes to over $15 billion dollars for the state and counting as there’s been numerous rate increases.

To add insult to injury, in 1997, “Access New Jersey” was created to wire the New Jersey schools and libraries with broadband—customers  paid for it via excess phone charges.

Meanwhile in the 1990’s the Internet and World Wide Web exploded onto the scene and everyone wanted faster speeds. Verizon pulled a massive bait and switch;  the company hadn’t been doing the fiber upgrades, and so it rolled out DSL over the old copper wires– considered inferior in 1992.

In 2005, Verizon filed for a system-wide cable franchise for FiOS cable service,  but it  only required 70 municipalities to be fully wired – out of 526 communities.  Verizon appears to have 252 munis with some wiring in them, but no plans to do the state. Meanwhile, the NJBPU never examined the previous ONJ commitments during the creation of the franchise.

In a strange twist, in  2012, two small towns, Stow Creek and Greenwich got the NJBPU issued two ‘show cause orders’; the first asked Verizon why these towns were never upgraded and the second was to fix the quality of service issues. Verizon had been planning to move the towns to wireless services instead of doing any upgrades.

Verizon responded, claiming that they had fulfilled all obligations.  New Networks filed a response using Verizon’s own data on behalf of some of the citizens of the communities. We pointed out that Verizon New Jersey was required to file an annual infrastructure report every year to prove that they were in compliance with the law. In 2001, Verizon claimed to have completed 55% of their territories with a 45 Mbps service. Yet, FiOS was not deployed until 2006 at the earliest.

We estimate that Verizon has about 50%-60% of the state ‘passed’ for FIOS, but about 1/3 of these are actually using FiOS. This means that the majority of the State is still based on the existing copper wiring.

The Verizon Attack

While Verizon agreed that it would upgrade the two towns, Verizon has no plans to continue to upgrade the communities outside of their required FiOS franchise obligations service.  And we expect the State to drop the ONJ commitments docket completely.

Also, Verizon refused to fix the copper wires in some towns after the Sandy Storm, including Mantoloking, and put the customers onto Voice Link, which is a 1990’s styled cell phone device that can not handle basic data applications, from fax to alarm circuits. (Recently Verizon was forced to concede as the residents revolted and is upgrading Fire Island, NY.)

Worse, a Verizon-sponsored deregulation bill is expected to be reintroduced in the Fall, claiming that new technologies, like VOIP need not be regulated. This is simply a ruse to shut down the utility networks and not have any obligations, like fixing the phone wires or even to offer service. Verizon’s plan is to force customers onto inferior or expensive wireless product like Voice Link. To add insult to injury, the FCC also has a docket to ‘transition’ – close down – the copper networks.

Verizon should have been the first ‘fully-fiberized” state. Verizon claimed it would create massive economic growth. New Jersey paid for a fiber optic future.

What Should Happen Next: I Want My Fiber

  • New Networks believes that the State should deny Verizon the cable franchise renewal until Verizon upgrades the state 100% with a service capable of 45 Mbps in both directions. It’s still the law and customers have been and continue to pay for these network upgrades.
  • Second, all discussions of any new deregulation should be halted immediately Verizon never fulfilled their previous obligations gained through deregulation — and there is nothing to show for it. Verizon should finish what they are legally required to do, which is to fully-fiberize the state or give back the money collected before any new deregulation is even whispered.
  • Finally, Verizon should not be allowed to push customers onto inferior wireless services as the issue is that wireless is not a replacement for wired service. Customers are not going to what movies on Netflix on their Iphone.

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