February 05, 2001, 9:41 AM — Complaints to the New York Public Service Commission over poor service from Verizon increased significantly in 2000 from the year before, meaning the company will have to pay millions of dollars more in customer rebates.
The exact total Verizon will have to pay is unclear. The telecommunications provider could face as much as $43 million in rebates, but hopes that exceptions made by the NYPSC for circumstances beyond Verizon's control will reduce the bill to around $17 million.
During the past two years, Verizon has paid about $5 million to $6 million per year in rebates, says spokesman John Bonomo. Verizon's worst year was 1995, when the service provider shelled out more than $70 million.
Bonomo says the increase in complaints last year was due to the strike by Verizon workers last summer and poor weather.
"In the early part of the year, there was an increase in complaints, due to moisture and wet conditions," Bonomo says.
Verizon has filed waivers for the strike and poor weather conditions, which, if accepted by the NYPSC, would reduce Verizon's rebate total.
Verizon's expanding DSL business and network capacity problems in some areas did not play a major role in the complaint increase, Bonomo says.
He notes that under an agreement with the NYPSC, Verizon must keep its service complaints to less than seven per 100,000 customers per month or higher rebates begin to apply. Verizon has come in under that threshold every year, he says.
Robert Rosenberg, president of InSight Research, a telecommunications market research firm, says it is unlikely Verizon customers will see improvements.
"SBC is regularly getting hammered by regulators in the Ameritech region," Rosenberg says.
"It's an endemic problem, and it's probably going to get worse," he adds.