Just as Verizon has replaced the Universal Service Fund fee customers paid each month with a new fee that goes straight into their bank account, BellSouth will likewise keep the charge in place and pocket the cash.
(Warning: strident opinions ahead. Thinking may be encouraged.)
The regulation has ended. People are not buying the story that your companies still need to recover costs for something that no longer exists. People are not stupid enough (I hope) to look at a new fee starting as one ends, with that new fee dropping directly into your coffers instead of Uncle Sam’s, and think of it as anything other than a straightforward grift.
News of Verizon’s fee exchange circulated yesterday. Instead of letting customers off the hook for the extra buck or two they had been paying for DSL service, Verizon will impose a new fee that almost matches the USF charge.
CNet brings us today’s tale that BellSouth has bettered Verizon’s decision. Instead of knocking off a few cents from the old fee to the new fee as Verizon did, BellSouth kept the full $2.97 per month fee intact.
The email BellSouth sent to CNet is, as MasterCard would call it, priceless:
BellSouth had a different explanation for keeping its $2.97 fee. It explained in a statement sent to CNET News.com via e-mail that the charge is “to offset costs incurred in complying with regulatory obligations and other expenses. The fee also recovers costs associated with additional systems necessitated by federal regulation, as well as costs associated with monitoring, participating in and complying with regulatory proceedings, and other network and servicing requirements.”
Let us reasonably concur that Verizon and BellSouth did indeed incur an expense associated with collecting, processing, and forwarding the USF fees to the bottomless spending pit we like to call “our Representatives in Congress.”
That expense, as it has existed, is now over. The companies should realize some small cost savings as they no longer have to dedicate time, people, and resources to USF collection. It is probably a nominal savings, considering Verizon and BellSouth have market caps of $99 billion and $72 billion, respectively.
Instead of taking the cost savings, and maybe some intangible goodwill by passing along the savings to consumes with USF’s demise, they pass along new replacement fees instead. Here’s Verizon’s perspective on those fees, again from CNet:
“We didn’t think the standalone DSL service would be competitively priced if we put all of the cost on the service,” said Bobbi Henson, a Verizon spokeswoman. “So we spread the cost across the entire base of our DSL customers. Doing this as another fee was coming off the bill seemed like good timing, since it will have little impact on what customers are actually paying per month.”
Good timing, yes. For whom, though? Customers?
Again, as was pointed out yesterday, other providers have delivered standalone DSL to their customers for some time. Verizon and BellSouth seem to contend that deploying naked DSL was as monumental an undertaking as getting Apollo 13 home multiple times.
The real shame is in a month or two, this will be forgotten. They know this. No one is going to stay fired up for a dollar or two each month. It shouldn’t be that way. Dollars add up over time. Verizon and BellSouth both know this. People should take that to heart as well.
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David Utter is a staff writer for Murdok covering technology and business.
