Verizon in the Dock: Petard Found, is Hoisting a Possibility?
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You don’t have to be too cynical an observer of the telecom scene to conclude that misleading regulators is part and parcel of the telecoms game and accepted as such by all, including regulators. It’s seen as akin to ‘over-emphasising’ injury in professional sport in the hope of getting the other guy penalised, or even sent off. It’s just the way things are.
Back in the early days of European competition, for instance, it was often noted how incumbent operators lobbied regulators with at least two completely different ‘stories’ supported by documents and expert witnesses: one set for their ‘home’ regulator, emphasising the importance of service continuity in the face of competition, the need to protect the incumbent’s scale, the boat anchor of its universal service obligation and so on. The second ‘story’ took the opposite line where the incumbent was moving into new national markets as a challenger. Suddenly the virtues of competition, open access and even unbundling were extolled.
If these startling Janus-like tendencies were pointed out it was explained that this was all part of the game - nobody takes issue with a telco for mounting the best case it can in any particular regulatory situation, much as a lawyer might act for a client in a criminal trial even though the alibi being advanced had more holes in it than a Swiss cheese.
But the decades of ‘getting away with’ overstated claims and, frankly, bald deception can catch up with you when the stakes rise and interested parties start digging about in the archives.
The stakes are high now in the US over network neutrality. With the intervention of President Obama green-lighting the FCC to reclassify Internet access under the Title II regulatory framework (designed to regulate monopoly service providers so they don’t abuse their monopoly positions) it’s full scale war and there’s plenty of sniping from the sidelines.
A shot or two will ring out today with telecom analyst Bruce Kushnick of New Networks Institute and audit director Tom Allibone of telecom customer advocacy group Teletruth, filing a petition against Verizon for perjury.
Bruce asks me, “Maybe you should ask your readers whether they think that we've supplied enough information to the FCC, [to justify the perjury charge] that Verizon claimed that net neutrality's reclassification to title II would harm investment,” while failing to acknowledge that “Verizon's entire FTTP, fiber to the premises networks that are used for FiOS are all Title II today and that Verizon used [Title II] to charge customers for 'massive deployment’ of fiber optics, at least, as we document it in New York State.”
So here’s the charge sheet and, according to Bruce and Tom, it’s an open and shut case.
“In the Net Neutrality proceeding, Verizon has claimed that ‘reclassifying’ the networks as “Title II”, telecommunications, will harm investment and stifle innovation. Yet, in every state proceeding, we found Verizon has used Title II to get the state utility rights of way and charge customers for the FTTP, Fiber to the Premises, construction, which is used for Verizon’s FiOS services. Verizon has never disclosed this fact in any of the Open Internet Proceeding or to the courts– Verizon misled everyone and we have filed, providing ample documentation — Verizon’s own statements to prove this point.
Section 1.17 of the Communications Act of 1934 details that “intentionally omit[ting] material information that is necessary to prevent any material factual statement that is made from being incorrect or misleading”,. and Section 1.16 of the Act states that violating of the Act is perjury.”
“The FCC can start criminal proceedings against Verizon for perjury,” Bruce is quoted as saying in Ars Technica. “In every document we went through there is no mention whatsoever that Title II is the foundation of their investment in fiber optics.” Verizon claims that “Title II harms investment,” Kushnick noted. “Well, no. Title II is the basis of their investment.”
We think it’s unlikely that the FCC will hoist Verizon into the dock on a charge of perjury, but the petition does provide some extra supporting fire for FCC chief Wheeler as he charges manfully at the US telco barricades. Is that enough evidence?