The FCC offered its opinion in the recent spat between cable MSOs and Verizon. Several cable companies lodged a formal complaint with the FCC claiming Verizon was illegally trying to stop customers from defecting to cable triple play offers. The complaint alleged that once Verizon got notice of a telephone number porting request, they aggressively pursued that customer with offers to keep them from switching phone service providers. The cable industry argued the practice is against the spirit of FCC competition guidelines, and may even be illegal. Verizon argues that they are doing nothing illegal, and are simply aggressively competing in the marketplace.
Apparently, the FCC agrees. In the Enforcement Bureau’s recommendation, the FCC, while suggesting Verizon’s retention marketing practice may need more study (and even recommends a Notice of Proposed Rulemaking on the subject), sees this type of debate as healthy for consumers and the competitive marketplace. “In fact, one could argue that, when the customer’s existing provider offers to lower prices or expand services to prevent the customer from switching providers, the customer benefits. This type of aggressive competition to win and to keep customers can result in lower prices for consumers, the introduction of new services and technologies, and improved quality of service as carriers compete in the open marketplace,” says the FCC Enforcement Bureau. They go on to say, “In fact, today’s competitive marketplace for bundled services, and intermodal competition of providers of services within the bundle, may reduce the need for regulation. It is reasonable even to ask whether further deregulation would allow for even more vigorous competition for customers and bring with it the associated benefits of such competition.” In the end, the recommendation rules for Verizon and says the cable company’s complaint and argument “don’t hold any water” in the context of the current guidelines and regulations. Checkmark Verizon.
