Verizon Doubles Down On Bogus Claim Title II Will Kill Broadband Investment

from the Title-II-hurts-puppies dept

Wed, Jan 28th 2015 2:35pm — Karl Bode

We've noted repeatedly that the broadband industry's claims that Title II reclassification will hurt broadband network investment just aren't supported by the facts. Title II, which governs the vocal components of wireless networks, certainly didn't hurt Verizon's effort to become the biggest, most profitable wireless carrier in the country, nor did it stop wireless carriers from spending $45 billion on spectrum at the latest FCC auction. It also certainly didn't hurt Verizon when it asked to have FiOS classified under Title II to nab tax breaks. Apparently forgetting there were other people around, Verizon CFO Fran Shammo was even quoted last December as stating Title II won't impact investment patterns in the slightest.

However, as anybody knows, when you're proven wrong time and time and time again, the only sensible thing to do is to dig a deeper hole and double down on your bluff. With billions in potential revenue thwarted by real net neutrality rules, Verizon appears to be doing just that.

Shammo apparently got the memo that admitting the truth is a big no no, so the CFO came out firing during the company's latest earnings conference call. Shammo now insists that everything he's said previously before Congress and in the media has been "misquoted," and Title II will most definitely hurt Verizon's network investment strategy:

"I would emphasize also that the approach in whole or in part on Title II is an extreme and risky path that will jeopardize our investment and the development of innovation in Broadband Internet and related services."

Except as Verizon's own history shows, there's really nothing risky about Title II with forbearance from heavier regulations, unless you're a company looking to use gatekeeper power to make an extra buck. Still, Shammo just can't help himself, and raises the ante further by insisting that this lack of investment will "trickle down" and hurt jobs:

"If we could curtail the investment of this industry, it will definitely trickle down to what we would consider middle-class jobs. And it’s because most of at least, for Verizon Wireless, a lot of our build are done by thousands of contractors across the United States, that will impact those small business and impact their employees."

Except again, if the "trickle down" claim didn't tip you off, that's a bluff. Verizon's not going to simply stop investing in its network with T-Mobile (and maybe even Google wireless) nipping at the company's heels, though I'm sure those companies wish it would. Shammo proceeded to proclaim that Title II-based neutrality rules would most certainly lead to lawsuits, which if you think about it is a truly Nostradamus-grade prediction when you're the one doing the suing. In short, Verizon's going to stick to its lie that Title II hurts puppies, causes tears in the time/space continuum, and is horribly unpatriotic -- whether we all like it or not.

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Filed Under: broadband, fran shammo, investment, net neutrality, title ii
Companies: verizon

19 Comments

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Mark Harrill (profile), 28 Jan 2015 @ 1:18pm

Investments
At this point, I'd like to see the FCC call Telecom's bluff and see if they don't invest in their networks. Cause if Title II is in place maybe some other folks will come along to build a good network and implement customer service that actually works for the customers.
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Anonymous Coward, 28 Jan 2015 @ 3:00pm

In terms of innovation the only thing I see being threatened is harming Verizons PR writers creative innovation as they pen their Fiber to the press release mis-statements. No actual innovation would be damaged though.
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Anonymous Coward, 28 Jan 2015 @ 3:01pm

considering how much and how often Verizon, Comcast and AT&T have done whatever it takes to stop any and all competition, the claim just cant hold water. on the miniscule off chance that it did, perhaps then Google will be able to go ahead with a TRUE broadband option for just about everywhere. if Verizon and the others keep out of the way and keep quiet, maybe there's something to what they say but i'll bet a dime to a dollar that as soon as there was any hint of Google getting into discussions in ANY city for installing broadband the big 3 would go totally ape shit!!
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Anonymous Coward, 28 Jan 2015 @ 3:05pm

" Verizon's going to stick to its lie that Title II hurts puppies, causes tears in the time/space continuum, and is horribly unpatriotic"

well it does hurt monopolies and that's unpatriotic.
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Anonymous Coward, 28 Jan 2015 @ 3:08pm

I would emphasize also that the approach in whole or in part on Title II is an extreme and risky path that will jeopardize our investment and the development of innovation in Broadband Internet and related services.

Their investment involves the following:

Putting out a press release $ X00.00 - $ X,000.00
Moving some equipment and people to the proposed area $ X,000 - $ X0,000 per day
Looking like you are doing something for a few weeks $ (X,000 - $ X0,000) * 28 days
Scamming the people in an area for years to come $ priceless
Half heartedly doing something is tough, for everything else there are lobbyists.
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Anonymous Coward, 28 Jan 2015 @ 3:10pm

Re:
didn't know the time/space continuum could cry like that
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Blackfiredragon13 (profile), 28 Jan 2015 @ 3:21pm

The only investment that title II reclassification would hurt would be their and the rest of the broadband industry's plans to screw over their customers at 235% more than they already are.
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Anonymous Coward, 28 Jan 2015 @ 3:26pm

"I would emphasize also that the approach in whole or in part on Title II is an extreme and risky path that will jeopardize our investment and the development of innovation in Broadband Internet and related services."

"our investment" meaning "Verizon's investment"

so?
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Anonymous Coward, 28 Jan 2015 @ 3:26pm

Re: Investments
Hmm... let's see: Verizon has already stopped all future FiOS development in favor of Wireless build-out. Sprint has already stated that Title II should have no impact on Wireless investment. Because of the lack of infrastructure requirements, they're most likely right -- which means that Verizon has no leg to stand on.

The only thing preventing all-out competition in the Wireless spectrum is... the spectrum monopolies. Verizon got a HUGE chunk of that, so there's not much reason for them to be impacted by Title II unless they're planning to do something dodgy to the customers at a significant profit.

What I'd like to see is transmission services be separated from the actual cellular providers, who would lease bandwidth from the transmission services. Kind of what it looks like Google is planning to do.
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John Fenderson (profile), 28 Jan 2015 @ 3:30pm

If verizon hates title II
If Verizon hates title II, they would go absolutely apeshit over what I think really should happen: nationalize our entire communications infrastructure. Make it a bit like the highway system: let the people own the pipes, and let companies run their services over those pipes for a reasonable fee. Those fees are used to maintain and expand the infrastructure.
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Chris-Mouse (profile), 28 Jan 2015 @ 3:51pm

Re: If verizon hates title II
The only problem I have with that is that it would put politicians in charge of running the pipes. For an example of why that's not a good thing, just take a look at the condition of those highways that the politicians are already in chsrge of.
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Anonymous Coward, 28 Jan 2015 @ 5:56pm

How can Mr. Shammo tell investors in December that Title II won't affect the companies stock prices. Then come out a month later and totally change his story?

Mr. Shammo better hope Title II doesn't affect Verizon's stock prices. Otherwise his company my have a lawsuit on it's hands for misleading investors.
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Anonymous Coward, 28 Jan 2015 @ 5:56pm

What they really mean...
Is the exact opposite...

Due to stiffer competition, they'll have to invest more heavily in order to retain their customer base - or allow someone else to eat that lunch.

Or maybe they'll just give up and focus on wireless (until that finally earns better regulation as well)... we can only hope. I'd love to see a bunch of newcomers in the market start taking over the wireline infrastructure and do something useful with it.
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Anonymous Coward, 28 Jan 2015 @ 6:49pm

Yeah, people will stop 'investing in Verizon' as it'll allow other grass root networks climb up to over take them...Wait, would that mean Verizon and others would have to provide competitive services that are based upon customer satisfaction? Oh no!
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HegemonicDistortion (profile), 28 Jan 2015 @ 7:14pm

It was predestined that someone named Shammo would hold this position.
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Geno0wl (profile), 29 Jan 2015 @ 6:03am

How can it kill it?
Verizon has already stopped FIOS rollout.
It is almost as if they see Title II is incoming, and their plan is to wait until after and then claim it is just "too expensive to continue their upgrade". Keep whining in some attempt to get the american people to think they are right that Title II was the wrong move.
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R.H. (profile), 29 Jan 2015 @ 6:30am

Re: Re: If verizon hates title II
To be honest, the state governments are in charge of maintaining the highways (some states delegate part of this duty to local municipal governments). As such. their condition varies greatly depending on where you happen to be. The federal government did a pretty good job with their part, building them in the first place.

There are other reasons not to have the federal government owning communications infrastructure (I'm not sure I want to make surveillance easier) but, maintainance probably shouldn't be one of them.
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John Fenderson (profile), 29 Jan 2015 @ 7:47am

Re: Re: If verizon hates title II
The state of the highways are more due to the lack of funding from all the tax cutting than from incompetence.
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Anonymous Coward, 29 Jan 2015 @ 10:38am

Does it take plastic surgery or just some injections to be able to say that with a straight face? They already use their standard Verizon FIOS CAPEX to build out fiber to their Verizon Wireless sites.

I bet after the stop all consumer FIOS footprint expansion they will turn around and claim to be investing in FIOS in spite of the current situation, when they are actually just wiring up their own equipment with fiber and claiming tax breaks and other credits.
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