Verizon (NYSE: VZ) has fired back at the Communications Workers of America's (CWA) claims that it has turned its back on its existing copper networks in its wireline region.
In an FCC filing, Verizon said that the CWA misinterpreted a statement it made in a July letter to the FCC about how much it invests on its copper network.
"As we explained in that letter, Verizon takes reasonable steps to ensure its copper network remains healthy and, contrary to CWA's suggestions, has not engaged in widespread "de facto" retirement of copper," Verizon said in an FCC filing. "As part of that discussion, we wrote that Verizon since 2008 has spent more than $200 million on its copper network. CWA has seized on that comment, taken it out of context, and tried to use it to create the false impression that this was all of the money that Verizon has spent to keep copper in service."
Verizon contends that the "more than $200 million" it referenced does not relate to all of the capital dollars the telco has made in maintaining its copper network.
"Instead, that figure included only one category of capital investments, dedicated to copper infrastructure improvement and focused on proactive rehabilitation of copper facilities and related network support elements -- i.e., cable, air pressure, batteries, etc," said Verizon. "That figure does not represent all of the capital Verizon has invested in its copper network, nor does it include the significant expenses incurred in connection with the copper network, including maintenance and repair costs. Instead, those dollars were uniquely relevant to the issues the Commission then was considering."
De facto copper retirement is a process where a telco will let their aging copper plant deteriorate to the point where it would become necessary to replace the copper with fiber.
Joining CenturyLink (NYSE: CTL), Verizon said its letter was sent to the FCC in order to illustrate its claim that the de facto copper retirement concept is a "myth" and there's no need to include new requirements addressing the issue in its technology transition plans.
CWA, which is still in the process of negotiating a labor agreement with Verizon, asked that federal and state regulators in the 11 states where Verizon operates wireline networks investigate its claims that the telco is not performing necessary repairs and upkeep on its copper landline networks. The union has filed letters to regulators in six states and Washington, D.C.
Nevertheless, copper maintenance and retirement has become an ongoing battleground between the ILECs, CWA and the CLECs that purchase facilities to deliver business services to their customers.
Seeing greater efficiencies with fiber, Verizon has been aggressively retiring consumer copper lines throughout parts of its wireline footprint.
At the end of the second quarter of 2015, Verizon reported that it had converted 51,000 customers off of copper to fiber, bringing its first-half total to 98,000. It has set a full-year goal to convert 200,000 customers.
Meanwhile, CLECs like XO Communications and Windstream, two providers that use ILEC copper loops to provide Ethernet over Copper (EoC) services to complement its fiber product set, are concerned about how the incumbents' copper retirement could affect their ability to deliver business services.
XO had previously asked for a one-year notice on copper retirement, a request that Verizon and US Telecom said would delay the IP transition.
- see this FCC filing (PDF)
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