Sunday, March 14, 2010

Verizon responds to ARRA in a predictable way

Dave Burstein reports in his newsletter that Veizon's FiOS buildout 'is dying'. Expansion into new areas is suspended. Verizon now focuses on areas where it already has agreements and expects to reach the 18 million homes passed by year-end 2010 - as promised before.

People are now complaining over being left in the dark, since 10 million Verizon customers may never see FiOS come to their premises. Such as those in Alexandria.

My comments:
  • You can't blame Verizon. This is how listed companies work. They have a focus on the short term. If you don't like it, change the system (ARRA is one answer, nationalisation is another).
  • Verizon is apparently seeking ARRA funds. Again, don't blame them. Looks like a sound business decision. This is exactly what you get when you throw government money at the market: it distorts the market and companies respond in a predictable way.
  • One thing the FCC should be looking at, is promises made by Verizon. In itself, it shouldn't be illegal to brake a promise, unless the promise itself got you funding or something like a regulatory holiday.
  • Another thing the FCC should prevent is Verizon trying to block Alexandria from building munifiber (should they want to), either with ARRA or Google funds.

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