The city of New York is suing telecommunications provider Verizon over failure to complete a FIOS buildout plan it made with the city.
In a complaint filed in New York yesterday, city officials said that the company failed to complete a FIOS installation plan that it said would be done by 2014. Verizon disputes those allegations.
The lawsuit is the latest volley in an ongoing fight between New York City and Verizon that started in 2015. As CivSource has previously reported, city officials started investigating Verizon’s FIOS installations in 2015, after the city noticed gaps in FIOS service as well as revenue discrepancies that should have been addressed through an existing exclusive contract that the city signed with Verizon FIOS.
New York City audited Verizon’s buildout of FIOS service as well as its revenue reporting and found that New York City field inspections confirmed that blocks claimed by Verizon as having FIOS service did not have the necessary equipment in place to even offer service. Further, Verizon’s own records indicate that service is “unavailable” at certain residential addresses, despite company claims that it can deliver service to all New Yorkers who want FIOS.
Verizon staff also admitted to city officials that they did not record or track inquiries from prospective customers who requested service before fall 2014. According to the city, this is in direct violation of the franchise agreement, which requires Verizon to track requests for cable service. Many service requests had been outstanding for at least a year the city says. Verizon for its part, contends that it has filed the necessary agreement extensions and is fulfilling its end of the deal. Verizon also blames landlords for not providing consistent access to buildings. The full audit is available here.
In a separate 2015 audit, New York City also found that Verizon understated its advertising revenues by approximately $28.2 million, resulting in approximately $1.41 million in franchise fees owed to the City. The company also contested this claim.
In the current complaint, city officials say that 1 million homes in New York City are still without viable access to FIOS despite Verizon’s claims that anyone in New York City can subscribe. Verizon’s contract with the city states that Verizon FIOS fiber must pass all New York households by June 30, 2014.
“Verizon must face the consequences for breaking the trust of 8.5 million New Yorkers. Verizon promised that every household in the city would have access to its fiber-optic FIOS service by 2014. It’s 2017 and we’re done waiting. No corporation – no matter how large or powerful – can break a promise to New Yorkers and get away with it,” Mayor De Blasio said in a statement on the complaint released yesterday.
According to a report from Ars Technica, Verizon has responded to the complaint with a letter of its own essentially saying that the political math inside city hall has changed since the De Blasio administration took over and that is the reason for this lawsuit, not a lack of service. The company also contends that many homes are near enough to FIOS fiber that they will be connected within a “reasonable amount of time.” Verizon has proposed an additional $1 billion investment in fiber in the city.
New York City isn’t the only municipality to allege problems with FIOS deployments. In 2015, mayors of fourteen cities in the Northeast including Albany, Brockton, Buffalo, Jersey City, Lowell, Newark, New York, Paterson, Philadelphia, Pittsburgh, Revere, Syracuse, Trenton and Worcester wrote a letter to the company accusing it of being a poor corporate citizen and demanding better service.