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BPU and Verizon Ink Deal: High-Speed Services, 'Yes,' Fiber Optic, 'No'

State says telecom provider can use DSL, wireless to deliver Internet to remote, rural areas

BPU Jeanne Fox
Credit: Amanda Brown
Jeanne Fox, commissioner of the NJ BPU.

The state yesterday approved a settlement with Verizon New Jersey to resolve a long-running dispute about how the telecom company will comply with a two-decades old law requiring it to provide high-speed broadband service to much of New Jersey.

The agreement, however, led some critics to question whether it will leave parts of New Jersey, particularly rural areas, without the type of high-speed Internet access available to more affluent areas.

In 1993, the state approved an alternative way of regulating Verizon, by far the largest provider of landline telephone service, in exchange for the company agreeing to upgrade 100 percent of its territory to high-speed broadband, a pledge the company has failed to fulfill, critics say.

In unanimously approving the settlement reached with Verizon, the New Jersey Board of Public Utilities agreed with its staff that the company has largely complied with the terms of the original accord.

But how Verizon is doing so is subject to much dispute. Some towns want the company to deploy fiber-optic cable, which can deliver phone, Internet access, and TV programming over a single line. But Anthony Centralla, the director of the BPU’s Division of Telecommunications, said that requirement was never included in the 1993 agreement.

Instead, under the deal approved yesterday, Verizon can meet its obligations to provide broadband by using digital subscriber service (DSL) or wireless networks, a prospect that troubled some.

Centrella and BPU President Diane Solomon also disputed an assertion by critics that Verizon profited from the program, dubbed Opportunity New Jersey. They said there never were any surcharges or fees placed on ratepayers’ bills to pay for the build-out.

Still, some were unconvinced about the merits of the settlement.

New Jersey Division of Rate Counsel Director Stefanie Brand noted some areas of the state are wired with DSL, which provides Internet access over the same copper wires that deliver traditional phone service.

“Verizon is not maintaining its copper wire systems,’’ Brand said. “DSL is on its way out.’’

Others questioned the reliance on wireless to provide broadband access.

“It’s a decent stipulation,’’ said BPU Commissioner Jeanne Fox. “I’m not thrilled with wireless service. I don’t think it ‘s as reliable, but it may be so in the future.’’

Brand noted, however, that wireless broadband access is significantly more expensive than other options.

“Internet access is no longer a luxury; it’s a necessity,’’ she said. “We felt out certain customers in rural New Jersey. Now, it will be changed so that some people will be left out. It’s going to create a system of haves and have-nots.’’

Verizon, however, welcomed the agreement as great news for the state’s consumers.

“It brings certainty to the state’s broadband market, giving Verizon New Jersey customers a request process to bring broadband to unserved communities,’’ said Lee Giercynski, manager of media relations for the company.

“Verizon’s network investments in New Jersey have made it one of the country’s most wired states in terms of broadband infrastructure, far exceeding what was contemplated by ONJ (Opportunity New Jersey)," he said, "and we are eager to move forward and work with communities to deliver the benefits of broadband to them through this process.’’

Ever since the state changed the law dealing with cable TV franchises, Verizon has been very aggressive in spending billions of dollars to bring fiber-optic service to customers in New Jersey. Under that law, however, Verizon does not have to build out its fiber optic network throughout the state.

That is a bone of contention in some municipalities, which would like to have the service for residents, but it is not yet available.

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