Communication Workers of America is seeking government intervention in order to protect union jobs at Verizon’s unprofitable wireline industry. If the union’s call for intervention prevails, it inhibits the growth of Verizon Wireless that CWA relies on to subsidize the worker’s it represents.
Since CWA’s two-week strike last August, it continues to use its political influence to publically tarnish the reputations of Verizon and Verizon Wireless in order to gain concessions rather than negotiate based on merit.
Now we observe CWA’s latest tactic in the nine-month contract dispute. CWA, along with several non-union allies Sierra Club, NAACP, Consumers Union, and the Consumer Federation of America, led a protest at Federal Communications Commission (FCC) headquarters. The coalition stands together against Verizon Wireless’ pending spectrum purchase from several cable companies. The deal involves Verizon paying $3.6 billion to acquire spectrum from cable companies including Cox and Time Warner. In addition, the companies also agreed to cross-sell each other’s services.
This is an odd deal for the union to disrupt when “Verizon officials describe its heavily unionized landline division as a laggard, while Verizon Wireless, a largely nonunion joint venture in which Verizon is majority shareholder, is hailed as the shining star, its hefty profits lifting the rest of the company.”
To complement their protest, CWA officials lobbied FCC bureaucrats “to impose conditions on the [Verizon cable] deal to ensure it is in the public interest.” Absent government meddling and FCC approval, CWA predicts doom and gloom. The union-led coalition of progressive special interest groups argue the deal will destroy jobs, raise prices, reduce consumer choice, and deepen the technological divide between cities and wealthy suburbs. CWA President Larry Cohen said, “This deal will freeze then diminish wireline buildout.”
CWA boss Cohen is right. Wireline buildout will diminish just not because of the Verizon Wireless cable deal. Over the past eight years, Verizon’s landline customer base has fallen from 55 million in 2003 to just 25 million today, a nearly 55-percent decline. The drop in consumer demand is the cause for decreasing investment in wireline, not the growth and investment in Verizon Wireless.
Yet, union bosses insist on keeping the same unsustainable contracts. Currently, Verizon CWA employees average total compensation of over $130,000 per year. Not to mention union members at Verizon never have been required to contribute to health care premiums, a contentious issue in negotiations for union officials and a primary reason for last summer’s strike.
Other than lavish benefits, the CWA contract contains several provisions underlying union inefficiency. One outdated union contract provision requires Verizon to dispatch two workers on service calls to certain parts of Manhattan. Another stipulates if union wireline technicians are dismissed for not showing up to work in the D.C. metropolitan area, they are eligible to receive up to 40 weeks of additional pay.
The sole purpose of CWA’s public posturing is to lobby the FCC to protect costly union jobs in the unprofitable wireline sector. It is clear CWA prefers to use government to combat business deals that benefit consumers than to actually perform its primary function of representing union members at the bargaining table.
You should get your facts right before you right an article. The outdated provision of dispatching 2 techs is for there saftey as well as the saftey of Verizon’s equipment. Would you work in certain area’s by yourself.
Did Lowell write this article? How about a customer’s phone being out of service for weeks at a time(most being elderly)? Closing repair tickets out without sending a tech out to fix it? Costly union wages? How about going from making 7 million a year to 20 million? When will the public wake up out of this in sleepy indifference? Why is it a crime to earn a decent living for your family? Would you rather every common worker make wal-mart wages and benefits?
Nice job writing a piece of crap. Get your facts straight, the bottom line is Verizon has and will have for the foreseeable future a very profitable wireline business. It’s called Fios. Sure Verizon is losing copper based landline customers, but they are lossing them to themselves. Verizon is moving or plans to move all of its customers in Fios available areas from copper to fiber. And for the record on average most Verizon outside unionized workers make 80 to 90 thousand a year. And yes they don’t pay for medical because they took some years of contracts with little to no raises compared to the going rates of those years. I’d like to see you work outside in all types of weather and temperature, climb poles and place 75 pound ladders on cables hanging in the air within close proximity off high voltage electric wires. Oh and by the way then work inside some ones home as a tv installer, phone technician, IT person, sales person, home surveyor, and construction expert all within a few hours while being micromanaged by some moron manager who never even worked in the outside field asking you a million questions about what you are doing solely so the can find ways to discipline you. So try to have a little respect for a person who works hard everyday and doesn’t get to sit behind a desk and use a pen to frustratedly rip what he wishes he had.
Joel, no. But someone does not deserve to make supra-market wages, which is the issue.
Greg, do you not follow telecom news? Apparently not. Verizon announced it was going to stop building out its fiber network late last year. Its wireline business is in steep decline, everybody knows it, except perhaps the workers who have been duped by their union, which is also in steep decline and looking increasingly pathetic.
Good come back Marc. So you believe everything that Verizon tells you rather then listening to both sides. And who is to take care of the wireline based Fios product after the buildout stops. It doesn’t install and fix itself. NYC alone is probably about 40% wired up. Which leaves millions of residents not installed yet. Most of those residents being in the boroughs of Brooklyn and Manhattan, which are no easy install areas. There is still years to go of install for NYC, so stop making it sound like it is obsolete like the company wants you to believe.
$49,526 received from Koch foundations 2005-2010 [Total Koch foundation grants 1997-2010: $520,946]
Greg, companies generally don’t tell investors that they’re not confident in their ability to deliver in the future unless things are really bad. Of course they’ll maintain their network for some time until it does slip so far behind competitors that they liquidate the entire operation (along with all employees). Perhaps there’s an entrepreneurial firm(s) out there that can run the network better than Verizon and restart the build out after acquiring the assets, but I wouldn’t hold your breath. And they almost certainly would be non-union.
Jean, SCANDAL! You’re telling me we received 1 percent of our funding from those evil Koch Bros’ charitable foundations?! Most people would tell you that’s not a huge amount of support, but we all know those dastardly Koch dollars are so evil that 1 percent = 100 percent = bought and paid for by the Antichrist, right?
You guys seem like smart business men, so why don’t you guys buy Fios? You do agree that Fios is the far superior product, that is bring fiber cable straight into people’s homes to achieve speeds up to 300 megs down as of right now, this sounds futuristic to me, endless possibilities. Since your establishment has been outed as getting support from the Koch brothers, you can probably get a loan from them to buy Fios. Good day “unbiased” sell outs.
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