Verizon slaps new $5 fee on its DSL subscribers

March 6, 2013 | By Sean Buckley

Verizon (NYSE: VZ) is once again putting a damper on its DSL subscriber base by imposing a new $5 fee on the service at a time when it has been shifting much of its attention to its wireless networks.

Although the service provider has been migrating a growing base of what it calls its "chronic" copper customers, or those who have three truck rolls per year on their service, to fiber-based FiOS, the expansion of the Fiber to the Home (FTTH) network is being focused on existing markets and meeting any remaining franchise agreements.

To soften the blow, Verizon said in an e-mail that it values its customers for their loyalty, adding that it has to increase the rates to maintain upkeep on its DSL networks.

"We hope you understand that to maintain our broadband networks, from time to time we need to increase our rates," Verizon said in an e-mail to customers. "Your monthly rate will increase from $23.99 to $28.99 (not including additional services or taxes and surcharges) and will be reflected on your bill within the next two months. The new rate will remain in effect for one year."

This latest rate increase follows a move last year by the telco to stop selling standalone, or what is called "naked" DSL, to consumers last April. Although the new rule does not affect existing users, any new customer or an existing naked DSL customer who wants to make a change to their account, including upping their connection speed, will be required to purchase a voice line.

At that time, Verizon justified the voice line bundle requirement as a way to continue offering customers "competitively priced services" and to improve the user experience for new and existing users.

During Q4 2012, Verizon reported that it added 144,000 net new FiOS broadband subscribers, while losing 117,000 traditional High Speed Internet (HSI) DSL subscribers, ending the year with a total of 3.37 million DSL customers.