Verizon Nixes New DSL Surcharge

Verizon Communications has removed a new DSL fee after customer objections and questions from the U.S. Federal Communications Commission (FCC).

Verizon implemented the new fee of up to US$2.70 for some DSL customers after the FCC earlier this month said DSL providers no longer have to collect a Universal Service Fund (USF) fee. The USF fee is used to subsidize telecom services in rural and poor areas. Verizon and BellSouth both proposed replacing the USF fee with a new charge whose proceeds they would keep.

Verizon had been charging DSL customers either $1.25 or $2.83 a month for USF fees, depending on the speed of service, and it replaced the USF fees with a supplier surcharge fee of $1.20 or $2.70 a month.

But the FCC raised questions about the fee, and last week, BellSouth said it would drop the new charge. Verizon said it needed the fee to offset the cost of providing DSL to customers who don’t use its telephone service. But customer complaints convinced the company to drop the fee, Verizon said in a statement Wednesday. Verizon will give a credit to the customers who got charged with the fee, the company said.

"We have listened to our customers, and are eliminating this charge in response to their concerns," Bob Ingalls, chief marketing officer of Verizon Telecom, said in the statement.

The proposed fee had prompted Verizon DSL customer Ailis Aaron Wolf to launch a website, called StopTheDSLRipoff.com. On the site, Wolf urged other customers to complain to the FCC about the fee.

The fee was a way for Verizon to "make another buck off its customers," said Wolf, a public relations specialist based in Arlington, Va., in an interview conducted via e-mail. "If they have additional costs associated with DSL services, they should have worked that into the original package price they offer, not tack it on after the fact."

FCC Chairman Kevin Martin said he was pleased that both Verizon and BellSouth have dropped the DSL fee. "Consumers should receive the benefits of the commission’s action last summer to remove regulations imposed on DSL service," he said in a statement. "The continued deployment of broadband at affordable prices for consumers remains my top priority."

-Grant Gross, IDG News Service (Washington Bureau)

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