Verizon overcharged New York POTS voice customers, says consumer advocacy group

Verizon (NYSE: VZ) has been for overcharging New York POTS voice customers $1,000 to $1,500 each, claims the New Networks Institute.

New Networks Institute, which is planning legal challenges to Verizon's pricing and financing plans, says that the excess charges were diverted so the telco could build its more profitable wireless and FiOS FTTH networks.

Bruce Kushnick, New Networks' executive director, told the New York Post that the telco overcharges to New York POTS consumers total billions of dollars.

The consumer group's allegations emerge as the New York Public Service Commission starts an investigation on Verizon's maintenance of its copper network.

For its part, Verizon said it will cooperate with the PSC, but says Kushnick's claims are not true.

"There is absolutely no factual basis for his allegations," Verizon said in a statement.

Kushnick also said that since the build out of Verizon's copper network was completed a long time ago, consumers should be paying a lot less for POTS service.

"All the copper networks have been written off," Kushnick said. "Copper-based phone services should be $10 or $20 [per month]."

Today, Verizon's POTS customers pay $23 a month for basic service, but taxes and other fees drive up the price to over $30 a month. According to a separate state report, the cost of unlimited local and long distance can be as much as $60.

New York isn't the only state where Verizon has come under fire for phone rates and the state of its copper network.

In February, residents in rural New Jersey reported to their county government about poor voice service quality and even outages during rain or snowstorms. At that time, 500 complaints were made.

Likewise, the Communications Workers of America (CWA) union, which is in the process of negotiating a new labor contract for its wireline workforce, asked the Pennsylvania PUC to investigate the telco's outside plant infrastructure.

CWA said its investigation reported what it characterized as hundreds of dangerous locations. The union documented over 200 examples in 13 counties where it says it found unsafe facilities.

For more:
- The New York Post has this article

Related articles:
CWA asks Pennsylvania PUC to investigate Verizon's outside plant infrastructure
Verizon won't need more capital to build FiOS customer base
Verizon's legacy network in rural New Jersey draws hundreds of complaints from residents

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