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Striking Verizon workers vow to put up a tough fight [The Buffalo News, N.Y.]
[August 14, 2011]

Striking Verizon workers vow to put up a tough fight [The Buffalo News, N.Y.]


(Buffalo News (NY) Via Acquire Media NewsEdge) Aug. 14--More than 1,000 striking Verizon Communications wireline workers in Western New York could be in for a long and protracted battle, the outcome of which could have far-reaching ramifications for labor in the 21st century.



On one side are wireline workers, those who manage the company's landline and fiber optic phones as well as FiOS cable and Internet service. They are holding out in fierce opposition to contract concessions they say would erode the last vestiges of a middle-class livelihood.

"They want to take 50 years of collective bargaining and throw it away," said Tiziana Daniels, a customer service representative.


Members of Locals 1122, 1115 and 1117, Communications Workers of America, and Local 2213, International Brotherhood of Electrical Workers have vowed a tough fight.

"We will do whatever it takes to keep our jobs," said Donna Vacinek, a customer service representative and union officer.

On the other side is the company, seizing its opportunity to cut its losses concerning its aging landline division. The company is able to dig in its heels at a time when unemployment is high, anti-union sentiment is rising and the economy is slow.

"These are all parts of what's emboldening Verizon to take a strong position," said Lee Adler, a labor lawyer and Cornell professor who has done education work with the Communications Workers of America. "If they're successful, other companies might try the same thing." With more and more customers dropping their home telephone service in favor of cell phones, Verizon said cutbacks in its landline division are unavoidable. Unlike other sales dips, Verizon's wireline losses are expected to be permanent as landlines move toward obsolescence.

In 2003, Verizon had 55 million landline access points. At the end of June, it had 25 million.

As a measure of the drop in value of landlines, in 2005 Verizon sold off part of its wireline company to Hawaiian Telecom for an average price of $12,027 per line. In 2008, Verizon sold wireline accounts in Vermont, New Hampshire and Maine to Fair-Point Communications for an average price of $7,207 per line. Last year it sold business in the Midwest and West Coast to Frontier Communications for an average of $1,770 per line.

After the sales, both Hawaiian Telecom and FairPoint declared bankruptcy.

"That is really the crux of the matter here. People have other technology and other means of communication and they're moving on from landline," said John J. Bonomo, a spokesman for Verizon. "We need to look at how we're going to manage the business for the next several years." Now that the wireline sales are lagging and have no indication of trending anywhere but down, the company said it can't afford to maintain the same labor deals it cut when the division was thriving.

But the wireline profits only look dismal, workers say, when compared to the soaring operating income from the wireless side--$9.04 billion for the first half of the year. They insist those wireless profits wouldn't have been possible without wireline workers.

"The revenue we brought to the company is what allowed the wireless [division] to be established," said Lori Speciale, a customer service representative and union officer.

Indeed, many Verizon Wireless customers have transitioned from Verizon landline to Verizon wireless in addition to or instead of Verizon FiOS.

And what about those wireless profits? Any way you slice it, Verizon as a whole is in good shape financially. Verizon's record profits and high salaries have become a mantra among workers.

Workers accuse Verizon of using the greater economy's woes as an excuse to tighten up on wages and benefits and to set the stage for union busting as it moves ahead with its largely non-union and less expensive wireless workforce.

Though Verizon is benefiting from workers' fears about the economy, Adler said, it's likely that the company truly is preparing for the worst--and it needs to conserve cash to do that.

Times have changed since the days when landline phones were ubiquitous, when telephone companies existed as regulated monopolies and faced no viable competition. But the wireline division is still earning money. Verizon's wireline division had operating income of $606 million for the first and second quarters of 2011.

But those numbers are no guarantee for the future, Bonomo said.

"It's a matter of recognizing the challenges we face -- and I think employees see that every day -- that landlines are going away," he said. "And that only promises to be more of a challenge." Workers argue that landline margins have improved and that the company's fiber optic Internet and cable television network is going strong. The company counters that the FiOS network is expensive, cumbersome and will never be able to match the kind of revenue it once had with landline phones.

But the company says it is not turning its back on wireline.

"If we weren't interested in this side of the business, we wouldn't have rolled out FiOS," said Bonomo, referring to the fiber- optic cable service that carries phone, Internet and television service. "FiOS is a demonstration of our commitment to the future of the wireline business." But it is expensive. Verizon has pumped more than $1 billion per year into the FiOS network over the past 10 years, and has spent $23 billion overall on its rollout.

It wouldn't invest that kind of money if it couldn't get it back, Adler said.

"Verizon doesn't expect landline to be an essential part of its strategy. It's just something it has to live with for a while," said Adler. "[However] it wants FiOS to be strong and good and make money, and it believes that it can. [The union workers] have been very valuable in getting that work done." schristmann@buffnews.com ___ To see more of The Buffalo News, N.Y., or to subscribe to the newspaper, go to http://www.buffalonews.com.

Copyright (c) 2011, The Buffalo News, N.Y.

Distributed by McClatchy-Tribune Information Services.

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