TELECOM Digest OnLine - Sorted: Dangling Broadband From the Phone Stick

Dangling Broadband From the Phone Stick

Jack Decker (jack-yahoogroups@withheld)
Tue, 22 Mar 2005 14:08:26 -0500


SAN FRANCISCO, March 18 - To gauge the potential consumer impact of
the consolidation sweeping the telephone industry, look no further
than the silver-toned plastic phone gathering dust on the desk in
Justin Martikovic's studio apartment.

Mr. Martikovic, 30, a junior architect who relies on a cellphone for
his normal calling, says he never uses the desk phone -- but he pays
$360 a year to keep it hooked up.

"I have to pay for a service I'm never using," he said.

He has no choice. His telephone company, SBC Communications, will not
sell him high-speed Internet access unless he buys the phone service,
too. That puts him in the same bind as many people around the country
who want high-speed, or broadband, Internet access but no longer need
a conventional telephone. Right now, their phone companies tend to
have a "take it or leave it" attitude.

Consumers "are not forced to go with SBC," said Michael Coe, a company
spokesman. "If they just want a broadband connection, I'd recommend
they look around for people who can provide just a broadband

The nation's other two largest phone companies, Verizon Communications
and BellSouth, have similar policies: broadband service is available
only as a bundle with phone service.

That means, even as high-speed Internet service has become one of the
most quickly adopted technologies of the computer era, there are few
options for the tens of millions of Americans trying to upgrade their
dial-up connections.

Some lawmakers and consumer advocates say the issue should be on the
agenda as the government considers the market impact of two proposed
big telecommunications deals: SBC's planned $16 billion acquisition of
AT&T, and Verizon's $6.75 billion offer for MCI, which is being
challenged by a rival offer from Qwest Communications.

For many consumers, the main alternative to broadband from the phone
company is the local cable company. But cable broadband prices tend to
be higher - as much as $60 a month for access, compared typically with
$40 or less for phone company broadband. And the cable companies
prefer to sell the service as a package with television that can
easily exceed $100 a month.

That is assuming cable is even available, which it is not in
Mr. Martikovic's apartment in the Nob Hill section of San Francisco -
or in 10 percent of the nation's households, for that matter. [.....]
Consumer advocacy groups, including Consumers Union, say they plan to
ask the F.C.C. to address the lack of "à la carte" broadband when the
agency reviews the proposed takeovers. [.....] Verizon has said it
is working to develop a stand-alone broadband offering that could be
available as soon as the end of the year. [.....] But the smallest
of the Bells, Qwest, which operates primarily in the Rocky Mountain
states and is struggling to grow, has been willing to offer à la carte
broadband for more than a year.

[Comment: As those of you who have been on this list for a while know,
it has long been my position that a customer should never be forced to
buy a service he doesn't want in order to get a service he does want.
My usual example would be a gas station that would not sell you gas
unless you also bought a case of pop, or vise versa. Gas stations
can't get away with that, not only because it's probably illegal in
most areas, but also because in most places there's another gas
station just down the street. Since phone companies don't have that
kind of competitive pressure, they tend to try to screw their
customers in ways that a normal business could never get away with.

I will always remember a time when I lived in a city in Michigan's
Upper Peninsula and my car stalled in the downtown area. I knew I
needed to pour some gasoline directly into the carburetor to get it
started, but fortunately (or so I thought) there was a gas station a
block away. The first problem was I didn't have a container to put
any gasoline in, but I only needed a little gas, and when I got to the
station I happened to look in the trash container and found where
someone had discarded a clean but empty plastic container of gas line
antifreeze. So, I thought, no problem, I'll get a dime's worth of gas
in this. Only problem then was, how to get the gas into the
container, which had a much smaller neck than the pump nozzle. I went
inside, explained my situation to the man inside, and asked if he
might have a funnel or even a piece of stiff paper I could make into a

And his reply was, "I won't sell you the gas unless you put it
directly into that container." I could not believe my ears. It was
obvious he wanted to sell more gas than just 10 or 20 cents worth, but in
doing so I would have wound up spilling a considerable amount of
gasoline on the ground deliberately (which, the last I heard, is
considered an environmental hazard) AND since I would have had to hold
the bottle while filling it, I would have very likely got gasoline all
over my hand as well. Bear in mind, this bottle wasn't an "approved"
container to begin with (it was not painted red or anything) so if his
concern has been about legalities he would have refused to sell me the
gas at all, but that wasn't his issue -- he just didn't want to be
bothered with selling such a small amount of gas, but would have sold
it to me had I been willing to spill enough on the pavement to make it
worth his while.

After some discussion with the man, who refused to budge on his
position, I told him I would never buy another drop of gasoline or
anything else at his station as long as I lived (and I never did!),
and walked six more blocks in below-freezing temperatures to the next
nearest station, which had no problem with offering me a funnel to get
the small amount of gas I needed to get the car started.

(The funny part about is was that the first gas station was in the
same block as, and almost next door to an insurance agency that I had
the misfortune of having some dealings with, and the guy who ran that
was in my opinion also a nutcase - now that I think back on it I
wonder if the gas station guy and the insurance agent were using the
same drugs, since they both shared the same customer-be-damned
attitude. I have to say, the Upper Peninsula has some of the
friendliest people in Michigan, but when they go into business there
is a small percentage of them that seem to turn into morons with bad
attitudes. I suppose that happens in lower Michigan also, but up
there people talk and compare notes more, I think, so when a person in
business is a real jerk, word tends to get around. But I digress.)

It seems to me that the phone companies are just like that gas station
owner when they refuse to sell unbundled DSL. They know there are
situations where the customer doesn't need their service, where the
traditional phone service will never be used, yet they require the
customer to take it anyway. It's just pure greed, just as it was with
that gas station owner. But since the phone companies are monopolies,
you don't have the option of walking six blocks down the road to the
next nearest DSL provider. That's why I've been in favor of any and
all alternative broadband technologies, including wireless and even
BPL if they can work out the interference problems.

At the same time, I think these proposed mergers do represent a golden
opportunity to get the SBC and Verizon to drop the forced bundling
requirement. That won't help the people served by companies like
CenturyTel, Alltel, BellSouth, etc. but it would make a big difference
here in Michigan where the vast majority of lines are owned by SBC or
Verizon. So, I hope Consumers Union is successful in their efforts in
that regard.]

Full story at:
[New York Times - free registration required]

TELECOM Digest Editor's Note:
Also see for the
story. PAT]

Post Followup Article Use your browser's quoting feature to quote article into reply
Go to Next message: Jack Decker: "Texas Sues Vonage Over 911 Problem"
Go to Previous message: Jack Decker: "Forbes Article on VoIP vs. Incumbent Telcos"
Next in thread: "Re: Dangling Broadband From the Phone Stick"
May be reply: "Re: Dangling Broadband From the Phone Stick"
May be reply: "Re: Dangling Broadband From the Phone Stick"
TELECOM Digest: Home Page