T'aint deregulation grand?
Verizon, BellSouth Won't Cut DSL Bills
Verizon and BellSouth won't pass on savings that result from a change in government telecom rules to their DSL subscribers. ... Last year, the government changed telecommunications rules so digital-subscriber-line, or DSL, subscribers would no longer have to pay into a federal fund that subsidizes phone services in rural areas and for low-income consumers. ... Two companies, Verizon Communications Inc. and BellSouth Corp., won't be passing that savings on to consumers. Verizon recently emailed subscribers announcing that it dropped the universal-service fee as of Aug. 14 and will impose a new “supplier surcharge” beginning Aug. 26. The new fee -- $1.20 a month for slower-service customers and $2.70 a month for faster ones -- is almost exactly what consumers would have saved with the government's change. BellSouth yesterday said it also intends to continue charging Internet subscribers its $2.97 a month “regulatory cost recovery fee.”It appears that the two companies are pocketing the money that consumers would have saved, although both dispute that notion. Verizon says it must eventually impose the supplier surcharge on all of its roughly six million DSL customers because of increased costs for providing stand-alone Internet service, which is purchased at a premium by consumers who don't subscribe to the company's phone service.
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“We know what people with market power will do. There's not a lot of competition,” says Mark Cooper, director of research for the Consumer Federation of America, a consumer-interest nonprofit group in Washington.Gene Kimmelman of Consumers Union, publisher of Consumer Reports magazine, agreed: “You can only get away with this when it's a tight market and not many providers. It's a back-door way of nickel-and-diming their customers.”
