Comcast, Verizon pointing fingers

Firms each say the other hinders competition

In the cutthroat competition for phone and cable customers, Verizon Communications Inc. and Comcast Corp. are looking for federal guidance.

In February, Comcast and other major cable providers filed a complaint with the Federal Communications Commission, arguing that Verizon was illegally offering enticing deals to departing customers. Last week, Verizon filed a petition with the commission requesting the commission to require it to be as easy to switch video providers as it is to switch phone service.

Comcast's complaint says that when Verizon is notified by a service request that customers are switching their home phone number to another provider, the company illegally bombards customers with express delivery letters, e-mails, and phone calls offering better deals as the customers wait for the switch.

"We are now the fourth largest phone service in America and offering significant value to our customers," Sena Fitzmaurice, Comcast's senior director of corporate communications and government affairs said in a statement. "It is regrettable that Verizon is engaging in anticompetitive behavior that the FCC has previously stated is forbidden and harmful to customers."

Braintree Electric Light Department general manager William Bottiggi said that customers who try to switch from Verizon to Braintree's service find salespeople in their driveways and receive letters with a stop sign offering special deals and offers to "talk to you about the pending order to disconnect your Verizon service. . . . What can we do to retain your business?"

According to the complaint, customers intending to depart Verizon receive offers of $50, $100, or $200 gift cards and "price incentives" to cancel the switch. Cable companies call this "anticompetitive" behavior that is forbidden by telecommunications law, which was intended to ensure that companies would not be able to take advantage of a legacy monopoly.

Verizon is free to try to win back customers once they have switched service, or if the company learns from customers that they are thinking of switching. But the complaint argues that Verizon has an unfair advantage because cable companies depend on Verizon to switch their service, and Verizon is using the notification process as a signal to market to a consumer.

"If a customer calls up to disconnect, you're speaking with the customer; that's open ground for negotiation. But if it's secondhand [information], there are some questions," said Bruce Leichtman, principal analyst at Leichtman Research Group Inc.

Verizon has said it is not doing anything inappropriate and claims that the cable industry is using the FCC to try to avoid competition, by seeking to stop customers from receiving competitive offers.

"The bottom line is simple - that they somehow feel disadvantaged when customers are switching from them to us," Verizon chief executive Ivan Seidenberg said in an interview last week. He added that the process to switch from a cable company's voice and telephone service to Verizon's is "onerous."

Verizon's petition at the FCC seeks to make the process easier by making it as easy to switch video providers as it is to switch phone service. Today, customers who wish to switch cable providers cannot simply call their new provider to switch and cancel their old service, as they can with a landline phone.

"Instead, they require the customer to contact them directly to cancel service after choosing a new video provider and to return any equipment," Verizon said in its filing. "This significantly complicates the process of switching video providers for the customer, thereby entrenching the cable incumbents' dominant market position."

Bottiggi said that he has seen the intense competition between telecom giants have very real repercussions on his business, where customers may sign up to switch service, then cancel their order.

"We can't market like Comcast and Verizon can - obviously, they spend millions and millions of dollars," Bottiggi said. "We do it all on a much smaller scale."

Carolyn Y. Johnson can be reached at cjohnson@globe.com.