FCC Needs To Step Up On Voice Link; Nature (and Natural Disasters) Abhor A Vacuum

According to this report from Stop the Cap, Federal Communication Commission (FCC) line staff are telling your average citizen who calls to ask that Verizon can refuse to repair their copper lines as long as Verizon offers Voice Link instead. “It is acceptable” for Verizon to refuse to offer copper service even if “there will be no landlines” available at all, said FCC Representative TSR54. (And no, I did not make up the designation just to make this look more like some faceless bureaucratic drone.)


Did I miss the FCC Order on this? No.  But the fact that FCC line staff are taking it upon themselves to say this is totally O.K. shows just how badly the FCC has lost control of the situation. The FCC needs to move quickly to (a) makes Verizon file the necessary application under federal law to discontinue its traditional copper service so the FCC can actually decide this question for real; and, (b) develop a process for carriers in areas where disasters have destroyed copper infrastructure to replace that infrastructure with a new product like Voice Link or voice-over-IP (VOIP). Otherwise, we can forget about having any kind of useful pilot program where we protect consumers and gather information.  Carriers will take the Verizon approach, and convert natural disasters into “nature’s little laboratories.”


After all, nature abhors a vacum — whether in space or in policy. If the FCC continues to let Verizon decide on the proper policy for itself, we can expect other carriers to stop playing by the FCC’s rules and follow in Verizon’s footsteps.


More below . . . .


In fairness to Chairwoman Mignon Clyburn, it is easy to see how this happened. Verizon only made clear its intention to abandon copper entirely for the part of Fire Island that has yet to see service restored in the last few days of the Genachowski FCC. At that time, Verizon sought permission from the NY Public Service Commission (PSC), so the matter looked like it was moving with state supervision. Still, under Federal law, a provider of telephone service cannot “discontinue” or “impair” service to a community (or portion of the community) without permission from the FCC. When Verizon filed its request with the NY Public Service Commission to replace copper with Voice Link on Fire Island, Verizon should have filed a similar application with the FCC.


Verizon has not filed the required Section 214(a) application with the FCC. A detail apparently lost in the transition between Genachowski and Clyburn. Since the NYPSC gave Verizon permission to deploy Voice Link instead of copper on Fire Island (at least on an interim basis), Verizon has moved full speed ahead to deploy Voice Link in other areas where Sandy destroyed the infrastructure, and is gearing up to deploy Voice Link in Florida (no doubt in anticipation of the upcoming “extremely active” hurricane season predicted by meteorologists).


Unless the FCC wants line staff to continue to make policy based on their best guess, the FCC needs to step up on Voice Link. More importantly, the FCC needs to figure out how it intends to deal with situations like Sandy, where a disaster destroys a major chunk of copper infrastructure that the provider does not plan to replace. Nature abhors a vacuum, and telcos will gladly fill the policy vacuum left by agency inaction with whatever policy suits themselves. Consumers need the FCC to get itself back in the game, rather than sticking disaster victims with whatever companies decide to provide.



What Does The Law Say?


Provision of phone service is what we call a “jurisdictionally mixed service.” Local issues are handled by the state. Interstate calls are federal jurisdiction. Infrastructure like phone lines, which carry both intra-state calls and interstate calls, fall under the jurisdiction of the state and the FCC.


This is particularly important these days when many states have significantly deregulated their telecom providers and nearly all states are considering such deregulation. (See this recent report from the National Regulatory Research Institute (NRRI) for the current scorecard). Section 214(a) of the Communications Act (47 U.S.C. 214(a)), prohibits any carrier that has a certificate from the FCC to offer an interstate telecom service from discontinuing or impairing that service (or discontinuing or impairing the physical line) without first obtaining permission from the FCC.


Verizon may wish to take the position that, for some reason, ending copper service and substituting an inferior wireless service does not count as “discontinuing” or “impairing” service. In that case, Verizon should have filed an explanation of why it did not think it needed to get permission and asked the FCC for a declaratory ruling.


When Verizon did neither, the FCC should have sent a letter from the Enforcement Bureau asking Verizon to explain why the FCC should not consider Verizon in violation of the relevant law. Needless to say, that did not happen either.


Is Voice Link An “Equivalent Service” To Copper?


As I wrote some time ago, Verizon has been shifting copper customers within its FIOS footprint from copper to fiber. This did not require permission because Verizon offered the same Title II traditional Time Division Multiplexing (TDM) voice service on its fiber line as it did on its copper line. So moving a customer from fiber to copper qualifies as a “line upgrade” which does not require any permission from anyone. (Eliminating the copper has other implications, which is why the FCC has pending before it since 2007 a Petition on regulating “copper loop retirement,” but that is a whole ‘nother side conversation.)


So how does Voice Link stack up? Can Verizon plausibly claim this is simply a “line improvement?”


There are a number of real problems with pretending moving customers to Voice Link is like moving customers to fiber. As a purely technical matter, unlike FIOS, Voice Link does not offer TDM service. So Verizon has clearly discontinued TDM service where it replaces copper with Voice Link and needs permission. Verizon’s terms of service (and its NYPSC filing) are more than a little murky on precisely what service Verizon is offering, and whether Verizon intends to have it classified as a traditional Title II telecom service or not. (Verizon stated in its application to the NYPCS that it would voluntarily behave in accordance with traditional landline telephone rules, but did not say the service actually counted as a traditional Title II landline service.)


But I am saving the regulatory implications around Voice Link for another post. For now, however the FCC and state regulators might ultimately classify Voice Link, it is enough to know that Voice Link is not TDM and that Verizon has therefore discontinued offering TDM service in the areas where it is offering Voice Link to replace copper.


Voice Link Does Not Include Services Available For Copper Customers.


As explained by my PK colleague Jodie Griffen, Voice Link lacks a lot of important features you get in a regular dial tone (in addition to losing DSL or any kind of data service).  Basically, Voice Link turns your house into a giant cell phone. So you get all the limits of a cell phone service, but not the mobility (the chief advantage of cell service). Some communities are particularly hard hit by the loss of these services. To spell out some of the most significant (and who gets hurt):


1. Voice Link will not allow you to receive collect calls, use calling card minutes or other forms of cheap long-distance provider, and requires you to have a separate international plan to make international calls.

Who gets hurt most. Immigrant communities, anyone with a loved one incarcerated or who otherwise needs to make a collect call. Since Voice Link also does not support any data plan, anyone who used to subscribe to VZ DSL and depended on Skype or other VOIP product is equally out of luck. Again, given the tremendous use of Skype by immigrant communities to call relatives back in their country of origin, this hits them particularly hard.


2. Voice Link will  not work with life alert systems or security alarm systems.

Who gets hurt. The elderly trying to maintain independence. Anyone with a burglar alarm or fire alarm system that does not have independent wireless connections.


3. Voice Link will not work with DVRs or Fax machines.

Who gets hurt. Any consumer that owned this kind of equipment and stuck with Verizon because they wanted to keep using it.


4. Voice Link will not work with credit card machines or other electronic payment processing.

Who gets hurt. Small businesses, especially when combined with losing their fax service to take orders by fax.


5. 9-1-1 calls may fail due to congestion on network or for other reasons, including Verizon negligence in routing the call.

Who gets hurt.  Well, any of those elderly whose Life Alert no longer works, for a start.


So again, it’s kind of hard to argue that substituting Voice Link for copper-based TDM does not trigger the requirement to notify the FCC that a traditional service has been “discontinued” or “impaired” to the community (or a portion thereof).


I should pause to note at this point that Verizon can still get permission under Section 214(a) by making a number of arguments, including that customers can get commercially available alternatives in the market (on Fire Island, that turns out to be Comcast). But there is a big difference between asking for permission (and getting it) and not asking for permission at all.



The FCC Sends Mixed Signals On What It Expects From Verizon And Other Carriers.


Instead of initiating some kind of enforcement action or even an informal inquiry on why Verizon didn’t file a request to discontinue its traditional copper service, as required by Section 214(a), the Genachowski FCC tacitly blessed Verizon’s decision to bull ahead without permission. Ironically, it did so in a Public Notice telling AT&T — which has played by the rules and actually asked for permission before ending its copper service and deploying its own version of Voice Link — that it needed to submit a more detailed proposal before going ahead with a conversion of copper lines to wireless. Note 30 of the Public Notice says: “We understand that Verizon is coordinating with applicable state authorities on the Fire Island transition. We hope to learn from these ongoing efforts in addition to the results of this proposed trial which would focus more systematically on the consumer experience during such a transition.”


I bet AT&T feels pretty stupid now. Why play by the rules and ask for permission when the FCC appears willing to let providers use disaster victims as guinea pigs?



Verizon Moves Ahead Full Steam, AT&T To Follow?


Never one to waste the opportunity, Verizon has moved ahead to eliminate copper and deploy Voice Link in Sandy devastated areas of New Jersey. An internal Verizon memo leaked to DSLReport describes plans to accelerate removal of copper and replace it with Voice Link in Pennsylvania. Verizon has also been busy training its crews in Florida to replace copper with Voice Link in something called “Project Thunder,” no doubt in anticipation of the active hurricane season predicted by the National Weather Service at NOAA.


Meanwhile, AT&T needs to repair its traditional copper lines in Moore, Oklahoma following the recent devastating tornado. Will AT&T continue to play by the rules and rebuild its traditional copper plant while waiting for the FCC to approve its proposed pilot program? Or will AT&T follow Verizon’s lead and turn Moore into its own pilot program?


AT&T has made no secret of the fact that they think the FCC is proceeding far to slowly by demanding a more detailed proposal and inviting another round of public comment. Since the FCC seems willing to allow “natural experiments” after natural disasters, why wouldn’t AT&T take the opportunity an Act of God has given it in Moore to deploy its own version of Voice Link, or its new voice-over-IP (VOIP) technology?


Natural Disasters Will Become Unregulated Pilot Projects.


As natural disasters run their course, providers will simply do what they want and to Hell with consumers. Eventually, it will occur to someone that the FCC’s failure to act when copper lines are replaced with wireless has established enough precedent that no permission is needed to replace working copper as well as damaged or destroyed copper. At that point the FCC becomes irrelevant to its core function of making sure the phone system works reliably for all Americans.


What could be bad? Unless you rely on Life Alert, or can’t get through reliably to 9-1-1, or have really abysmal voice quality so that you may as well not have a phone in the first place. Then it will totally suck. But other than that, what could go wrong? Well, unless you needed to send or receive a fax, But, other than that, what could go wrong? After all, as FCC line staff keep telling anyone from the public who asks, even if there is no other wireline provider in the area, Verizon (or AT&T, or any other carrier) can do as it wants, when it want, how it wants, charging however much it wants, as long as it offers something.  That is, to quote the FCC folks answering the phone “totally acceptable.”



The FCC Needs To Step Up And Assert Leadership


If the FCC wants to remain true to its pledge to make consumer protection a “core principle” guiding the phone transition, it needs to act to reassert some semblance of control over the process. More importantly, it needs to act now.


The FCC needs to take two steps right away.


First, the FCC needs to make it clear to Verizon (and, by example, every other carrier), that they cannot flout Federal law. Verizon either files a request to discontinue traditional copper line service and replace it with Voice Link, files a request for Declaratory Ruling that it does not need permission, or face an enforcement action to explain why its conduct in New York, New Jersey and Pennsylvania does not violate federal law. Regardless of whether Verizon files something or the FCC goes the enforcement route, the agency needs to make clear that it will not tolerate “self-help” in this area. Carriers either play by the rules (as AT&T has done) or face serious consequences going forward.


Second, the FCC needs to establish a process for what happens when significant portions of a copper network get damaged or destroyed and need replacement. If providers like Verizon want to offer alternatives like Voice Link to avoid repairing or replacing what they consider obsolete copper technology, then these providers need to come in now – before people lose service and have no alternative – and demonstrate that the new service they propose to deploy is an adequate substitute.





It’s clear that the hand-off between Chairman Genachowski and Chairwoman Clyburn has resulted in a major fumble for the PSTN transition. Verizon picked up the ball and ran with it. But despite conduct that should be seriously out of bounds, the FCC has so far declined to make the right call.


If Chairwoman Clyburn wants to see carriers play by rules that protect consumers, the FCC needs to throw a flag on the play now. Consumers and small businesses in three states are poised to lose essential phone services they rely on for conducting business, staying in touch with family, and keeping themselves safe. We can expect that more consumers will lose the same services after every tornado, hurricane and wildfire unless the FCC makes carriers play by the rules.


Stay tuned . . . .