Verizon has numerous reasons for wanting its DSL services to die off, including the fact that newer LTE technology is cheaper to deploy in rural areas and easier to keep upgraded. But one of the driving forces is that Verizon is eager to eliminate unions from the equation, given that Verizon Wireless is non-union. None of this is theory; in fact, it has been made very clear by Verizon executives.
“Every place we have FiOS, we are going to kill the copper,” Verizon CEO Lowell McAdam recently told attendees of an investor conference. “We are going to just take it out of service. Areas that are more rural and more sparsely populated, we have got LTE built that will handle all of those services and so we are going to cut the copper off there.”
In other words, Verizon will cut off copper in FiOS markets first (which makes sense given the lower maintenance costs of fiber). They’ll then leave users in DSL-only markets un-upgraded, forcing them to buy a costly landline so that remaining on Verizon DSL becomes less attractive. Those customers will flee to the same cable companies with which Verizon just signed a massive new partnership, with Verizon planning to sell those users more expensive LTE connections later. Verizon will continue to “compete” in FiOS areas for now, if you call winking and nodding when it’s time to raise prices competition.
Rural areas could see the biggest impact from the shift, as Verizon pulls DSL and instead sells those users LTE services at a high price point ($15 per gigabyte overages). Verizon then hopes to sell those users cap-gobbling video services via its upcoming Redbox streaming video joint venture. Expect there to be plenty of gaps where rural users suddenly lose landline and DSL connectivity but can’t get LTE. With Verizon and AT&T having killed off regulatory oversight in most states, you can expect nothing to be done about it—despite both companies having been given billions in subsidies over the years to get those users online.