I hate to call out companies like this, but I feel the need to let everyone know about a change Verizon is instituting in their Premises Access License (aka “PALS”).
Since the PALS are a (i) separate agreement (ii) they auto-renew so they have no expiration date and (iii) are not tied to (if applicable) any Verizon marketing agreement… the PAL lives on even after any marketing agreement has expired. So this “modification” they are implementing can have a huge impact on a community’s telecom future. Here’s the issue:
Verizon is adding Anti-Bulk language to all new PAL documents (Renewal, Greenfield, or Brownfield)! This means, if you execute their standard PAL, the property will never be able to sign a Bulk telecom services agreement with another provider as long as the PAL is active.
If you sign a Non-Exclusive Marketing Agreement (“NEMA”) with Verizon… once the marketing agreement expires, the PAL is still in place…so the property is not allowed to sign a Bulk agreement with another provider (you can sign one with Verizon, but that is all).
Now, If you have an Exclusive Marketing Agreement (“EMA”) in place with another provider and are just allowing Verizon to service your community with FiOS so your residents have a choice OR you are getting notices (like some of my clients are) related to upgrading the copper facilities to fiber-based facilities (or they will disconnect you and your residents Verizon services)…signing a Verizon PAL will prevent the property from considering a Bulk TV and/or internet program with anyone but Verizon for as long as the PAL remains in place.
I predict that other providers will begin instituting something similar on any new development deals…and once this happens, owners will be forced to choose a Bulk or non-Bulk from the outset (and will never be able to pivot to the other option in the future).
Anti- Bulk language has always been a part of an EMA or NEMA, but now requiring it to just service a property is next level. I sort of understand why they are doing this (they want to protect their investment…as it can cost upward of $1,000 or more per unit to install and deliver FiOS to a community), but to me, this is like telling a single family neighborhood or an office building that they will only install FiOS if they can guarantee enough subscribers so that Verizon does not lose money on the install.
Suggestions/Recommendations:
1) If you are a long-term holder of a community and can’t ever see moving to Bulk telecom services, then this change is not an issue and you can ignore this whole post.
2) Begin to keep track of when you can terminate a PAL so you can take the necessary steps to do so, thus enabling you to look at Bulk with another provider (however, terminating a PAL normally terminates Verizon’s rights to service the community/residents – so this can become a tricky/sticky mess).
3) Don’t sign any new PALS with Verizon until they remove the language… In the cases where Verizon is shutting off service, it may be better to switch the property phone, elevator, fire alarm, etc. lines to a competitor…and if you still have residents using Verizon phone and DSL service, you may want to help them move into the current century.
4) Work with your local Verizon account representative to see if you can put a limit on the length of time the Anti-Bulk language will remain in effect.
5) Reach out to an owner-focused Telecom lawyer or a company like ASM (yes – shameless plug) to assist you in navigating thru this issue.
In the immortal words of Kuiil the Ugnaught…”I have spoken”.