Asbury Park Press

Phone, Cable Deregulation Opponents Launch Campaign

Asbury Park Press — Wednesday, March 9, 2011

By DAVID P. WILLIS
STAFF WRITER

Consumer and senior advocates in New Jersey have banded together to fight the deregulation of the state's telephone and cable industries, a move they fear will raise prices and hurt service quality.

The grass-roots efforts, led by New Jersey Citizen Action and AARP, have launched the campaign, called "Don't Hang Up on New Jersey," to fight a proposed measure in the state Senate that would eliminate regulations that govern how telephone and cable companies operate in New Jersey. Those include measures that set rates for no-frills local telephone service and require credits for cable outages.

A similar bill already has passed in the state Assembly. The next Senate voting session is scheduled for March 21.

The bills have the support of the state's cable industry and Verizon New Jersey. They claim that competition for telephone and video service makes the reasons for the regulations obsolete.

"It will provide some increased flexibility for companies like Verizon to compete and invest in a changed marketplace," Verizon spokesman Lee Gierczynski said.

Among the concerns is a worry over the price of basic telephone service, which can cost $16.45 to $23.71 a month after taxes and fees, and is now set by the state Board of Public Utilities. The prices for other services, such as long distance calling and plans, have been deregulated for years.

Low-income residents and senior citizens, including those that are homebound, depend on local telephone service as a lifeline, said Doug Johnston, AARP's lobbyist.

"To all of a sudden expose consumers in New Jersey to the whims of the phone companies to increase rates and add new charges to their phone bills is completely unjustifiable," Johnston said. "We are deeply concerned if this bill becomes law, bills will go up because there will be nothing standing between the phone companies and consumers."

Verizon's Gierczynski said Verizon has no plans to stop offering basic local telephone service. "These claims offer hypotheticals that are often unrealistic in a world where consumers have multiple choices," he said. "If the company chose to arbitrarily raise its rates or failed to provide good service to customers, we would lose those customers to competitors."

With customer defections would come lost revenues and damage to the company's reputation, he added.

It is hard to predict what could happen, said Stefanie Brand, director of the state Division of Rate Counsel, another opponent.

"I think they could stop offering those services if they chose to. They could greatly raise the prices. That's the problem. It would be totally up to the companies what they do," Brand said. "While there may be competition in the industry, it is not for the old lady with the land line."

Other aspects of the proposed legislation affect service quality issues, such as requirements that cable companies provide credits for extended outages.

"Right now the cable companies are required to give you a credit on your bill if you have an outage or if you have problems with your service," said Jackie Cornell-Bechelli, political and legislative director for New Jersey Citizen Action. "With this legislation, they are free to do whatever they choose to do."

Mark Nevins, a spokesman for the New Jersey Cable Telecommunications Association, said the legislation will promote competition in New Jersey and "increased competition is the best way to empower consumers."

"The telecommunications market in New Jersey is competitive, innovative and marked by consumer choice," Nevins said in a statement. "This legislation will create jobs and grow our economy by promoting investment while customers continue to enjoy the benefits of robust competition."

The opposition campaign includes a Facebook page, which as of Wednesday had more than 1,600 "Likes," as well as a petition drive through the group's website, www.DontHangUpInNJ.com. The group has made nearly 4,000 calls to the offices of state senators, Johnston said.

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