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Press Release

    Cable vs. Phone

    11/23/2005

    Skirmishes between cable operators and phone companies over getting into each other's businesses are breaking out across the U.S. In the New York region, it is already out-and-out war -- and escalating. Phone giant Verizon Communications Inc. has targeted the affluent suburbs around New York City to be among the first to get wired for its television and super-high speed Internet services. But in doing so it has run straight into the bare-knuckle tactics of Cablevision Systems Corp., the local cable operator. In its fight against Verizon, Cablevision has filed a suit and backed an ad campaign against the phone company, supporting a group that printed fliers accusing Verizon of littering manicured suburban landscapes with refrigerator-size equipment boxes. The same group mailed fliers attacking James Altadonna Jr., the mayor of Massapequa Park, on New York's Long Island, for giving Verizon permission to roll out its new video service inside the town's borders. Cablevision says Verizon doesn't want to serve low-income customers in the targeted municipalities around New York. Verizon denies it will discriminate against anyone. Verizon has also sent letters to several mayors of towns where it is seeking permission to roll out video warning them to expect "intimidation tactics" from Cablevision. The phone company distributed coupons for free bologna sandwiches to "offer an alternative to cable's baloney." Meantime, consumers already have begun to benefit. Verizon significantly dropped prices for phone service shortly after Cablevision announced it was boosting its broadband speeds at no extra charge to subscribers. The phone company's $29.95 monthly plan for long distance roughly matches the pricing for phone service offered by Cablevision. … Cable operators like Cablevision already have rolled out phone service and are making it difficult for phone companies to get into TV. Cablevision executives insist that they're not trying to block Verizon from competing with them. They only want to make sure that Verizon has to follow the same voluminous rules they do. In particular, Cablevision wants Verizon to obtain so-called franchises from municipalities that require them to offer service to everyone in the area. Verizon has decided to pursue franchises but has argued they don't need to be identical to the ones cable operators obtained because as local telephone companies they already meet many of the requirements.