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Verizon Quality Issues Have Gone Long Distance

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By RICHARD MULLINS | The Tampa Tribune

Published: June 19, 2008

Verizon's customers in Florida have complained for months about delays in fixing basic phone service, erroneous bills and discount deals that never materialized. Now, some of those problems with Verizon are appearing across the nation.

Regulators in at least 10 states say the telephone giant's drive to sell more lucrative cable TV and broadband Internet access is leaving behind millions of other traditional telephone customers with service that's "disturbing," "habitually poor," and a "failure."

While Verizon executives say their traditional land-line phone service is good and will improve, more consumer watchdogs and regulators say Verizon's phone service has taken a sharp turn south, with the company too often taking a week or more to restore broken phone lines, raising public safety issues.

The problems come at a vital time for New York-based Verizon Communications Inc., as more people drop their home phone for a cellular phone and others switch to cable TV providers or free Internet phone service. To compete, the company is making a high-stakes bet, spending $20 billion nationwide to build a new fiber optic network for cable TV, Internet and phone service called "FiOS."

"They've really been selling the heck out of FiOS, but everyplace they start offering it creates a strain on their system that they're not prepared to handle," said Bob Williams, a director at Consumers Union in Washington. "Especially for older folks who are not going to go with just a cell phone, that basic phone is their lifeline to the world. If regulators and public officials aren't concerned about this, they should be."

Verizon executives defend the company's overall service quality.

"Verizon offers phone service that is superior to our competitors, most of whom are not required to answer to state regulatory commissions nearly to the degree as Verizon — if they do at all," said Verizon spokeswoman Sharon Shaffer. "More importantly, customers who don't like the service they're getting — or the price they're paying — can and do change providers."

Building a state-of-the-art fiber optic network, Verizon officials say, will ultimately mean fewer breakdowns, more robust competition for cable TV service and an overall boost to local economies needing better communications networks.

That project is vital for Verizon to survive against cable companies that also offer phone, Internet and TV service, said Jeff Kagan, an independent telecommunications analyst in Atlanta. "Verizon is spending a ton of time, money and effort to compete," Kagan said. "They can't just sit back and let cable companies like Comcast win their business."

In these early stages, "that's where the problems occur that they need to fix," he said, "and they have to do that without damaging their existing brand."

Lately, state regulators across the country are complaining loudly about those problems, calling for hearings, investigations and millions of dollars in fines for lax phone service. Utility regulators in Maine, Maryland, Massachusetts, New York, Oregon, West Virginia, Ohio and New Jersey, to name a few, have weighed in on Verizon.

In Oregon, for example, Verizon went from being best among four telephone providers to worst, state regulators say, behind CenturyTel Inc., Qwest Communications International Inc. and Embarq Corp. (formerly Sprint).

In Indiana, Verizon has been providing "erratic and very poor" service and maneuvers around the rules to "just barely exceed the minimum standards," said Beth Roads, assistant general council for Indiana's Utility Regulatory Commission.

Roads said phone service from Indiana's other phone providers, Embarq Corp. and AT&T Corp., hasn't slipped, and Verizon only agreed to an improvement plan when Indiana threatened public investigations, she said.

In the past few months, Verizon's quality has improved, which Roads said shows "they can improve things if they're focused on them."

In Tampa, Verizon officials acknowledged that it sometimes took a week or longer to restore broken phone service at some homes because the company shifted so many technicians to installing new cable TV and other fiber optic services.

At the same time, Verizon's own promotional programs have broken down this year, with Verizon taking months to ship the free TVs it offered customers in exchange for signing up for package deals. Verizon employees in Tampa have picketed the company, protesting that they're pushed relentlessly to sell customers new services, rather than fix billing problems or answer questions.

Florida's attorney general has called for an investigation into Verizon's phone service breakdowns and called for $6.5 million in fines for what he called "repeated willful violations" of basic service standards.

Officials Cite Public Safety Concerns

Regulators in states far from Florida are raising similar concerns.

In Maryland, Verizon executives were chastised during a two-hour, heated public hearing last fall, and regulators demanded to know why some residents were waiting a week or more for Verizon to repair broken phone lines.

"For a person who doesn't have phone service for five days — an elderly person — that's the kind of thing we need to be concerned about," said Maryland Public Service Commission Chairman Steven B. Larsen. "Not having service is a public safety concern."

Verizon vice president and general counsel Leigh Hyer called those faults "rare exceptions."

Not persuaded, Maryland opened two formal probes of Verizon: one into repair delays and another into reports that Verizon would tear out a customer's existing copper phone lines when they sign up for FiOS, meaning extra expenses if customers ever switch back to traditional phone service.

New Jersey regulators say complaints about Verizon have doubled in the past five years. And Virginia regulators this February rejected Verizon's argument that investment in its new FiOS service "justified Verizon's failure to meet [standards]" with its basic phone service.

Verizon Says Complaints Are Rare

Typically Verizon executives respond this way when regulators start raising questions about Verizon service complaints:

First, Verizon officials have argued in several states that customer complaints are rare, but any complaint is taken seriously. Second, the company says other factors should be taken into account, such as bad weather that damages lines and keeps repair crews grounded. Finally, Verizon executives have argued in several states that regulators should credit Verizon for building a new fiber optic network.

Meanwhile, Verizon is overhauling some aspects of its customer service approach.

Verizon is experimenting with new "Personal Account Managers." These contract employees are hired to be advocates for customers – sidestepping Verizon's own internal customer service departments. Verizon also started publicizing new toll-free numbers for special teams of representatives, assigned only to untangling things such as billing mistakes or repair problems.

Meanwhile, in Florida, where Verizon now faces formal complaints by the state attorney general, the company called state complaints "deeply flawed" and due to a "misunderstanding" of state rules.

Verizon is only required to make "reasonable efforts" to meet benchmarks under "normal circumstances," such as good weather, argued Dulaney L. O'Roark III, Verizon's vice president and general counsel in the Southeast, in a written response to Florida's complaints. Florida regulators, he argued, should "take into account Verizon's massive investment in [FiOS]" fiber optic services.

Customers, he wrote, will provide "ultimate penalty by choosing one of the many alternative providers if they are dissatisfied with Verizon's performance."

The report includes information from The Star-Ledger of New Jersey and The Washington Post. Reporter Richard Mullins can be reached at (813) 259-7919 or rmullins@tampatrib.com.

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