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from: Technology Daily

Verizon Shifts Its Policy Focus To Boosting Broadband Deployment

By David Hatch

(Monday, February 12) Verizon Communications led the charge last year for deregulatory telecommunications legislation in Congress but has reversed course now that Democrats, who are considered less friendly to the Bell companies than Republicans, control Congress.

"We are not looking for sweeping telecommunications legislation this year," lobbyist Tom Tauke told reporters at a Monday briefing, explaining that his firm has won regulatory relief at the FCC and in several states. Nevertheless, he applauded Republican efforts last year for drawing attention to the Bells' concerns.

AT&T, BellSouth (which is now part of AT&T) and Verizon lobbied heavily in 2006 for GOP measures that would have eased their entry into the video-programming business and taken other deregulatory steps. Supporters argued that the legislation would have benefited consumers by fostering competition.

Verizon is now focusing on other matters, such as boosting high-speed Internet deployment in rural America. Tauke argued that President Bush's goal of universal broadband access by 2007 has not been achieved in remote areas and that new initiatives are needed. In particular, Tauke cited an initiative in Kentucky to deploy broadband statewide as a model for elsewhere.

The Bush administration contends that the goal will be accomplished by the end of 2007.

Verizon has been criticized for being part of the problem in expanding broadband access. In January, it announced plans to spin off wireline operations in northern New England to Charlotte, N.C.-based FairPoint Communications. Critics accuse Verizon of dumping customers where telecom lines are expensive to upgrade, but the companies counter that FairPoint has the resources to deliver cutting-edge technology.

The investment firm Medley Global Advisors also recently said Verizon may shed 3.4 million access lines in four Midwest states.

Verizon "periodically" reviews its assets to determine what to keep, Tauke said. "I don't think [the FairPoint deal] is representative of any failure" on the company's part to serve rural areas. "It represents a desire to ensure that we are enhancing the opportunities for customers in that area."

Meanwhile, in late January Citigroup concluded that in Cablevision's Connecticut, New Jersey and New York territory, Verizon is "targeting upscale counties and more affluent areas within these counties" with FiOS, its new high-speed, fiber-optic video and data service.

"The average household income among FiOS markets is $77,000 per year, about 27 percent higher than Cablevision's average household income, and 67 percent higher than the U.S. average household of $46,000 per year," Citigroup said. That data could provide ammunition to critics who contend that in deploying new services, Verizon is bypassing low-income and minority areas, a practice known as redlining.

Tauke strongly denied the allegations, emphasizing that Verizon carefully monitors its deployment to prevent redlining. He noted that Verizon is deploying FiOS in areas with greater density because of cost factors. "So it's hard to deploy FiOS in really rural areas," he said, adding that "perhaps that will change over time."

Other Verizon officials insisted that the company is offering FiOS in a racially and economically diverse mix of places.