Some Verizon "supporters" had no idea e-mails were sent on their behalf.

Verizon led massive astroturf campaign to end NJ broadband obligation

by Jon Brodkin

Verizon doesn't want to deploy high-speed wired broadband service to all New Jersey residents, despite receiving financial perks from the state for the past 20 years in exchange for building a statewide network.
To make sure it doesn't have to complete the buildout to all of New Jersey's 8.9 million residents, Verizon led an astroturf campaign that flooded the state Board of Public Utilities (BPU) with hundreds of identical e-mails purporting to support Verizon's case. One person who is listed as having written one of these e-mails told Ars that he didn't submit anything, and if he did, "I would've slammed them." A report in Stop the Cap this month found several other Verizon "supporters" who had no idea e-mails were submitted under their names.

Before describing the astroturf campaign, here is a little background. Verizon is on the verge of getting state approval of a settlement eliminating an obligation to provide broadband service to the whole state by 2010. Instead of just getting service automatically, people who want broadband from Verizon would have to complete a "bonafide retail request" process and prove that they and at least 34 neighbors can't get service from anyone else. Even then, Verizon would have nine months to comply and could meet its newly lessened obligation by making 4G cellular service available through its subsidiary, Verizon Wireless.


Verizon predecessor New Jersey Bell agreed to the statewide broadband buildout in a 1993 agreement with the state. In exchange for a different form of price regulation that would allow the company to make more money, "Verizon agreed to upgrade its network to provide broadband to every Verizon New Jersey business and residential customer, school, and library for 100 percent of its service territory," according to the state's Division of Rate Counsel.

"Verizon New Jersey committed to have 100% of their territory rewired with a fiber optic service capable of 45Mbps in both directions and completed by 2010," according to telecom analyst Bruce Kushnick. "Known as 'Opportunity New Jersey' (ONJ), state laws were changed to give the company billions of dollars in higher phone rates and tax perks."

"We believe customers paid over $15 billion to Verizon New Jersey for these upgrades... and the money continues to be collected," Kushnick also wrote. "That's about $4,000.00-$5,000.00 per household."

Verizon reported $120.6 billion in revenue and $32 billion in operating income in 2013, though in New Jersey the company says it has run "annual negative net income of over $500 million in a number of recent years."

Verizon told Ars that the 1993 agreement only called for data rates up to 45Mbps and said that Verizon was allowed to reach that with DSL rather than fiber. The agreement "never dictated that a specific technology be used to meet the standard," Verizon said. The proposed rewriting of the agreement would explicitly allow wireless instead of wired broadband.

Verizon said in a filing with the state that it has "invested more than $13 billion in its wireline infrastructure in New Jersey and billions more in its wireless infrastructure." New Jersey has 3.2 million households. Verizon says its fiber-to-the-home deployment “passed 2.1 million premises” and that DSL is “available in 100 percent of Verizon central offices.”

Verizon spokesperson Lee Gierczynski told Ars that this "investment far exceeds the $5.4 billion contemplated by ONJ, all done as competition continued to erode Verizon’s wireline business and the company reported annual negative net income in recent years." Verizon "never collected excess fees or taxes or imposed surcharges for the deployment of broadband in New Jersey," Gierczynski said.

Verizon did receive "modest pricing flexibility for certain services," the spokesperson said—those would be the higher rates Kushnick referred to. However, Verizon said the 1993 agreement "also imposed a price cap on basic phone service that resulted in no increases in that service from 1985 to 2008."

“I can assure you that I did not send that response”

One of the last steps before Verizon gets state permission to eliminate its universal broadband obligation was collecting public comments. The comment period is over, but it's not clear when the board will make a decision.

To tilt the process in its favor, Verizon launched an astroturfing campaign that sent hundreds of e-mails to the state utility board.

"Dear Board Members," one such e-mail reads, continuing:

I would like to declare my support for the proposed stipulation between your Board Staff and Verizon as it relates to Opportunity New Jersey. The stipulation will help ensure continued deployment of advanced communications services. Access to these services will not only benefit New Jersey’s businesses and nonprofits, but consumers of all ages as well. I’m sure you will agree that advanced communications technologies have revolutionized how all residents and businesses in the Garden State communicate and we must ensure that future innovations by this industry find a home here in New Jersey. 

New Jersey has benefitted from the significant investments Verizon has made here to build a robust communications network. Our state is now the most wired broadband state in the country and continued investment in broadband technologies will be critical to New Jersey’s ongoing economic competitiveness.

Four hundred sixty-five people sent an e-mail with that text to the state board during the comment period, with 418 of the e-mails coming in the three-day span from March 22 to March 24.

We didn't try to verify the authenticity of every e-mail, but did send messages to a couple of dozen of the sending addresses. One address turned out to be invalid. The owner of another e-mail address said he had no idea that he was listed as a supporter of the campaign.

"I am a customer only to Verizon and I was not contacted by them to submit anything," the person told Ars. "If they did, I would've slammed them. They are gougers. If AT&T was where I lived, I would switch in a heart beat."

When this customer was shown the e-mail he allegedly sent to state officials, he said, "That would mean someone did it on my behalf. I can assure you that I did not send that response."

“As a Verizon employee...”

LinkedIn searches show that some of the people sending the aforementioned e-mails are Verizon employees, with titles such as "field tech" or "sourcing process leader."

Those e-mails didn't identify the writers as Verizon employees, but a second form letter did identify all of its senders as employees. It reads as follows:

As a New Jersey resident and Verizon employee, I am expressing my support for the proposed stipulation between BPU Staff and Verizon. The proposed stipulation is fair and balanced and, under your guidance, will build on the success that the Board and Verizon have achieved in making the Garden State one of the most wired broadband states in the country. 

Access to advanced communications technologies is no longer a luxury; it's a necessity. Thanks to Verizon, New Jersey consumers and businesses can harness the power of these technologies like never before. By leveraging new and innovative technologies like 4G LTE and fiber, Verizon has helped put the power of the Internet into more consumers' hands across the state and fulfilled its Opportunity New Jersey obligations. The future holds even more promise. 

Few companies have made the kind of critical infrastructure investments in New Jersey that Verizon has made and you can count on Verizon to continue working with communities across the State to deliver the benefits of broadband services through this program. 

Please approve the proposed stipulation without further delay. Thank you for taking the time to consider my view and for all you do for the people of New Jersey.

Three hundred twenty-seven people sent e-mails with that text in a six-day span, with 315 of them coming on March 19 and 20.

Verizon has 176,800 employees company-wide and 15,000 in New Jersey, so it's no surprise that it was able to get a few hundred to send a form letter to the state.

Where did the other e-mails come from? One of the senders, a Verizon customer, told Ars that he received an e-mail from a friend at a communications firm working on Verizon's behalf. The request made no mention of Verizon attempting to forego its obligation to deploy broadband to the whole state.

"I hope you are doing well. I have a favor to ask," the e-mail read. "I'm working on a project for our client, Verizon, and they need some signatures to an online petition. Verizon wants to expand its offerings in New Jersey, but needs approval from the state. Higher-speed Internet, more FiOS, etc."

"All you need to do is enter your e-mail and zip code," the message continued. "I appreciate it. We're in a contest with another vendor to see how many people we can get to sign it. Just let me know yea or nay, so I can get the credit for it."

Many people sending e-mails on Verizon's behalf likely had no idea they were helping the company erase an obligation to build a statewide broadband network.

Phillip Dampier of news site Stop the Cap contacted 150 people who sent the "I would like to declare my support" e-mails, with predictable results.

"Many of those submitting comments used non-working e-mail addresses or claimed their names were submitted without their knowledge or permission," Dampier wrote. "Many others were actually employed by Verizon or were retirees." One was a Verizon lawyer who didn't disclose the identity of his employer in his e-mail to the utility board.

"Remarkably, 35 of the e-mail addresses turned out to be invalid, so we contacted an extra 35, and 12 of those e-mail addresses were invalid as well," Dampier wrote. "We found this unsettling because the only identifying information attached to the pro-Verizon correspondence was a name and e-mail address. We couldn’t be sure the authors were New Jersey residents, much less real people."

Out of 18 replies, "several were Verizon retirees asked to sign letters of support for Verizon," wrote Dampier. "Another five had no idea what we were talking about and denied they submitted any views, pro or con, about Verizon. Three of those were Comcast customers that said goodbye to Verizon more than a decade earlier. Many others were associated with groups that happen to receive financial support from Verizon. Several had no broadband access and were using dial-up.

"Stop the Cap! did not receive a single reply from any person ready to articulate informed views about the terms of the settlement offer. They were simply asked to lend their names and e-mail addresses to Verizon’s campaign and had never seen the settlement proposal or heard much about it."

In several instances, "some of Verizon’s 'supporters' actually used a space provided in the form letter to vent their frustration with Verizon!" Dampier continued. "Michael DeNude was irritated he never got FiOS: 'We live in Riverdale and have not benefited by any upgrade.'"

Gierczynski pointed out that the AFL-CIO used similar tactics.

"450 [e-mails opposing Verizon] were standard form letters generated by the AFL-CIO, and of those letters, 25 were from people located outside of New Jersey and some appeared to be from municipalities not in Verizon’s service territory," the Verizon spokesperson said.

Those e-mails said, "Verizon is obligated to upgrade New Jersey’s copper wire network. To fund this expansion, which was supposed to be completed in 2010, Verizon was permitted to collect excess charges from their customers. These charges, which began more than 20 years ago, are still being collected today... I am asking the Board of Public Utilities to be my advocate and not only require Verizon to give me what I was originally promised under Opportunity New Jersey, but to also investigate where my dollars were spent."

As for Verizon's campaign with employees, the company "contacted more than 3,800 management employees who live in New Jersey and asked them to submit comments in support of the stipulation," Verizon said. "Participation was strictly voluntary, and the process was completely transparent. Employees could write their own letters, use the template provided, or modify that template with additional comments. The letters acknowledged the sender’s employment with Verizon and included the employee’s e-mail and home addresses."

What they’re arguing about

The astroturf messages don't really help us understand what Verizon and its opponents claim, so let's take a look at the more substantial arguments.

The state public utilities board's proposed stipulation issued in January would resolve its investigation into what it called "Verizon NJ's alleged failure to comply with Opportunity New Jersey commitments."

The settlement "allows the use of any technology to provide broadband, including 4G-based wireless," the Verizon spokesperson told Ars. "Verizon New Jersey could provide 4G wireless broadband by contracting with Verizon Wireless if that proved to be the best solution for customers."

The stipulation proposes a "new plan of alternative regulation" in which consumers would be handed the burden of having to prove that Verizon should extend them broadband service. To make a request for service, they'd have to gather at least 35 business or residential customers within a single census tract and prove that they "have no access to Broadband from cable service providers... have no access to 4G-based wireless service; and each sign a contract agreeing to at least one year of service and pay a $100 deposit to be credited towards their service."

Within nine months of receiving such a request, Verizon would have to arrange for broadband service to be extended to the customer, but it wouldn't need to be wired broadband. "For the purposes of this Stipulation, Broadband is defined as delivering, through the use of any technology medium (including 4G-based wireless, fiber, copper, or cable), data transmission service at speeds no less than the minimum speed of Verizon NJ's Digital Subscriber Line Services ('DSL') that is provided by Verizon NJ as of today's date."

According to comments filed by the city of Newark, the minimum speed of Verizon's DSL today is just 0.5 to 1Mbps download and 384Kbps upload, well below any typical broadband standard. Newark said defining broadband as including cellular "takes no account of the technology's limitations compared to copper or fiber."

"Current wireless networks cannot now be a complete and perfect substitute for fixed access broadband, except in the least densely populated areas, where there will be few simultaneous users. Wireless service degrades substantially as the number of users increases, and it is subject to significant usage limitations," city officials wrote.

Several other groups have objected, with the New Jersey Association of Counties saying that "approximately 2 percent to 7 percent of the State's residents and businesses in Atlantic, Burlington, Cumberland, Cape May, Hunterdon, Salem, and Warren counties lack access to a fixed broadband network. Under the proposed Stipulation of Settlement, these residents and businesses would be relegated to using less reliable and more expensive technologies for vital education, commerce, and communications needs."

Verizon told Ars that it has "deployed broadband to more than 99 percent of the census blocks across the state" but didn't specify the percentage of residents in each census block who are offered service or say what speeds they are offered. The FCC defines broadband as at least 4Mbps down and 1Mbps up.

The City of Newark says Verizon promised much more. "In the early 1990s, Verizon’s predecessor, New Jersey Bell Telephone Company, requested that the Board subject it to an alternative form of regulation in exchange for the company’s commitment to make New Jersey a 'fully fibered state,'" Newark officials wrote to the state utility board. "The company explained publicly that it pledged to rewire its entire copper telephone network with fiber and emphasized that the plan would impact 'every consumer' because fiber would extend into “every single home and business in the state."

The proposed broadband request process "does not constrain the price that company may charge for such a service offering" and "materially lessens the required build-out, especially in poorer areas," Newark said. The settlement doesn't even impose any requirement to serve public entities, Newark said.

McKelvey asked the state to force Verizon to give the township fiber service.

Not all towns are demanding changes to the settlement. Mayor Matthew Henrich of the rural Woodland Township, which has 500 homes, an elementary school, and a "handful" of businesses, wrote that "the proposed settlement appears to be intended to benefit a community like ours."

Verizon: Our investments are “extraordinary”

Verizon has angered customers and regulators from coast to coast by refusing to fix or deploy infrastructure. After Hurricane Sandy wiped out phone lines on Fire Island in New York, Verizon tried to push customers onto wireless service instead of fixing the lines. The company agreed to replace the copper phone lines with fiber only after state officials and the FCC intervened.

In California, Verizon was accused of "deliberately neglecting the repair and maintenance of its copper network with the explicit goal of migrating basic telephone service customers who experience service problems." Verizon has argued that it can't afford to build a fiber network while also maintaining old copper phone lines.

Verizon wrote in support of the proposed stipulation in New Jersey. The state is one of only five where at least 81 percent of the rural population has access to 25Mbps speeds, the company said.

"What makes Verizon’s investments even more extraordinary is that they were made while Verizon was losing billions of dollars in revenue as millions of our customers—in a state that now has one of the most competitive communications markets in the country—'cut the cord' entirely and/or obtained services from VoIP, cable, or wireless competitors," Verizon said. "Despite these challenges, Verizon pressed ahead, not only unwavering in our commitment to meet the goals of Opportunity New Jersey, but, most important, to keep our commitment to our customers to provide the best products, services and networks for their communications needs of today and tomorrow."

Even though not every resident got service, "by any truly informed and reasonable measure, Opportunity New Jersey has been a success, most significantly because Verizon chose to invest billions more in our deployment of broadband than was ever contemplated or required," the company said.

The revision of the 1993 agreement "build[s] on the success of Opportunity New Jersey by agreeing to a proposal to allow any community in Verizon’s territory where groups of customers with no broadband availability may request and obtain broadband service from Verizon."

Verizon called much of the opposition to the new agreement "uninformed and factually inaccurate."

One "false assertion is that Verizon’s broadband obligation could only be met through the deployment of fiber facilities," the company said. "The fact is, as the Board has recognized for years, DSL deployment satisfies the broadband commitments in Opportunity New Jersey. And, of course, FiOS as a broadband service did not exist in 1992, when Opportunity New Jersey was developed. Furthermore, the Verizon Wireless 4G LTE network provides broadband at average data rates that in many cases exceed those provided by DSL."

The 1993 agreement is outdated because "dramatic technological innovations and robust competition in the industry have rapidly spread the availability of broadband services and increased the connection speeds available to consumers and business," Verizon said. Twenty years ago, "Verizon was the sole telephone provider in much of its service territory and no other provider was in a position to provide broadband to residential and single-line business customers."

"In conclusion, we believe the facts are clear and that the Board should approve the Stipulation," Verizon wrote.

However, a state agency responsible for representing the public interest urged the utility board to reject it. The New Jersey Division of Rate Counsel told the board that meeting broadband obligations with wireless instead of wired is unacceptable and that the request process residents have to go through to get service is "insufficient to meet the mandated network deployment and upgrades agreed to by Verizon."