Crain's New York Business

Sluggish Verizon hangs up Internet service providers; Survey finds phone line

problems slow DSL connections; company disagrees,

September 18, 2000, Monday, Pg. 4

Michael Mcdonald

Service from Verizon Communications is growing worse, say companies that

depend on the Baby Bell to offer high-speed Internet access in New York.

      A new survey by Manhattan-based New Networks Institute found that 70% of

Internet providers say that problems selling digital subscriber line, or

DSL, service over Verizon's copper telephone lines have escalated in the

last year.

       The ISPs say that their main problems involve delays getting new lines

installed or old lines repaired. As well, they say Verizon is trying to

poach customers who are trying to buy service through independent ISPs but

are having problems getting connected.

Postmerger report card

       The new survey is one of the first looks at how Verizon is performing nearly

a year after the company, formerly known as Bell Atlantic, was allowed to

expand into long-distance service in New York by federal and state

regulators. As a condition of that move, Bell Atlantic had to prove to

regulators that it had opened up its telecommunications network sufficiently

to allow other companies to compete with it in the state.

       One of the first areas of competition has been high-speed Internet access. A

host of companies have entered New York, but the companies must rely on

Verizon's phone network to sell DSL.

       ''When an ISP places an order for service, there's a 50% chance there is

going to be some kind of delay,'' says Bruce Kushnick, who conducted the

survey and runs the independent institute. ''This means that the Baby Bells'

networks are not open to competition.''

       A spokesman for Verizon disputed the survey results, saying that most ISPs

do not buy directly from the Baby Bell but instead go through competing

telephone companies like Covad Communications Group Inc. He said that 90% of

all orders are completed on time.

       The state's Public Service Commission has begun collecting DSL complaints

made by wholesalers like Covad but has not made any of the data public. A

spokesman at the PSC did say that Verizon made some improvements earlier

this year processing DSL orders, though no specific details were available.

Owner's fault

       According to Mr. Kushnick and officials from firms here in New York, the

problems the industry is encountering go back to the owner of the main

telephone network.

       ''We're dealing with the wholesalers, but we're also dealing with our

customers, who see what is going on,'' says Alexis Rosen, president of

Public Access Networks Corp., which sells Internet access in the city. ''The

delays are getting worse.''

       Verizon, SBC Communications Inc. and other regional Bells are seeking

approval to sell long distance in other states, including Massachusetts and

Pennsylvania. The ISPs are one group lining up to oppose the applications.

       ''The regulators need to look at real operating conditions, which means the

ordering process, and the provisioning and installation process,'' insists

Barbara Dooley, president of the Commercial Internet eXchange Association in

Washington, D.C. ''If it does not improve or if it deteriorates, they need

to take that into account.''