FCC

Verizon: DSL-Phone Bundle OK with FCC

3/21/2005 2:22 AM Eastern

Verizon Communications’ policy of terminating digital-subscriber-line service at the same time a customer cancels local-phone service is consistent with federal regulations, the Baby Bell told the Federal Communications Commission last week.

Verizon, the nation’s largest local phone company, said it had explained its bundling policy to the FCC before in a long-distance entry application and “the [FCC] reviewed it and approved it.”

Verizon was responding to Comcast Corp.’s allegation that the Baby Bell is violating FCC number-portability rules, which require Verizon to transfer a switching customer’s phone number to a competing telecommunications provider unless it is not technically feasible.

Comcast did not assert that Verizon’s bundling practice was illegal -- only that the company’s refusal to port a number until both local-phone and DSL service had been disconnected was contrary to FCC regulations.

In a March 16 letter, Verizon explained that in order “to avoid customer confusion and frustration at the sudden and unexpected loss of Internet- and e-mail-access services, [it] requires customers to cancel their DSL service before porting voice service to a new local service provider."

Verizon said that under its policy, it won’t port a number until after the competing phone provider has notified its new customer that it needs to contact Verizon to cancel DSL. Time Warner Inc. has told the FCC that Verizon's policy of delaying the porting of a number until DSL service is terminated is inconsistent with number-portability rules.

Number portability is viewed by Comcast and other phone entrants as vital to promoting local phone competition, as customers are less willing to switch if they can’t retain their numbers.

In the FCC letter, Verizon said it was working with industry groups to cure number-portability defects, and it was developing a “stand-alone DSL product that would address the concerns of Comcast and other carriers that seek a streamlined porting process and also address the porting customers’ desires to maintain their existing DSL service and e-mail addresses.”

Other companies have complained about Verizon’s bundling policy, not just about number portability.

AT&T Corp. has called local phone-DSL bundling anticompetitive because a Verizon DSL subscriber who wanted to experiment with a voice-over-Internet-protocol service, including AT&T’s own “CallVantage” product, had to subscribe to two voice-service providers in order to do so.

The FCC is considering a BellSouth Corp. petition asking the agency to bar states from requiring phone incumbents to provide DSL to consumers who take local-phone service from a company that leases dial-tone lines from BellSouth.

MCI Inc. -- which has an agreement to merge with Verizon -- told the FCC last week that BellSouth’s refusal to provide DSL to a customer who is not also a local-phone subscriber “hinders the development of VoIP services because consumers with BellSouth DSL may be discouraged from subscribing to a VoIP service if they have to also maintain and pay for their regular landline local service.”

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