Verizon, Cablevision Faced With Power Outages, Low Fuel

Phone and cable companies, working to restore service to areas battered by the Atlantic superstorm Sandy, struggled with lingering power failures and a shortage of fuel for backup generators.

Verizon Communications Inc. (VZ), the largest phone company in the region, said thousands of employees have fanned out across New York and New Jersey to repair the damage, though power outages and blocked roads slowed efforts. By 10 a.m. today, 15 percent of mobile-phone sites remained out of service, down from 25 percent three days earlier, according to the U.S. Federal Communications Commission.

“Fuel has been a challenge,” said Peter Thonis, a spokesman for Verizon. “But we are working with federal and local officials, and we are making it happen.”

Consolidated Edison Inc. (ED), the electric company serving New York, said today it has restored power to 67,000 customers in the East Village and to 27,000 customers in the Chelsea, West Chelsea and FlatIron neighborhoods. It expects the rest of lower Manhattan to be restored by tomorrow.

“Getting commercial power will enable us to no longer be on generator power, and that will certainly make a big difference,” Thonis said.

Repair Costs

Sandy, the largest tropical system ever measured in the Atlantic, struck Oct. 29. It killed at least 90 people in the U.S., flooded subway tunnels and knocked out power to as many as 8.5 million homes and businesses along the East Coast, including about half of New Jersey. The storm will cost telephone and cable companies as much as $600 million in repair and cleanup costs, according to James Ratcliffe, a New York-based analyst with Barclays Plc.

Verizon said costs related to repairs and service interruption from the storm “could be significant,” according to a filing today. Thonis declined to provide more precise cost estimates.

About 97 percent of Verizon’s cell sites hit by the storm in the Northeast are now operational, Thomas Pica, a spokesman for Verizon Wireless, the company’s mobile-phone carrier, said by e-mail.

Engineers and technicians with Verizon restored backup power to four critical facilities in lower Manhattan and one on Long Island that incurred severe flood damage and lost commercial power. The locations included the company’s own headquarters at 140 West Street, which became a symbol of Sandy’s wrath after Verizon posted a picture of its flooded lobby on the Web.

Headquarters Building

Damage from the flooding has been cleaned up at 140 West Street and the facility’s network operations are now “100 percent functioning,” Thonis said. Executives and other staff who normally work at the lower Manhattan office building have been using other offices, including an operations center in Basking Ridge, New Jersey, he said.

Verizon has the most exposure to the damage because it has many customers in the Northeast with land-line service, Ratcliffe said in a note. Cablevision Systems Corp. (CVC), meanwhile, has the biggest portion of its customer base without service. The cable company, which focuses on the New York market, said that at 4 p.m. today about 1.32 million subscribers can’t connect to its service because their power is out. That compares to about 1.5 million yesterday. Cablevision, based in Bethpage, New York, has about 3.3 million video subscribers in total.

“Restoration efforts in the hardest hit areas -- including New York and New Jersey -- continue to be more difficult,” David Turetsky, chief of the FCC’s Public Safety & Homeland Security Bureau, said in a statement. Finding enough fuel for generator-powered equipment is a major concern, he said.

No Power

Cable service disruption rose to 17 percent from 14 percent or less yesterday, an increase that was due to including a stricken company from earlier counts, Turetsky said in a statement today. Without the additional company, which he didn’t identify, the disruption would have declined, he said. Today the agency assessed 146 counties in seven states and the District of Columbia, down from 158 counties across 10 states and the District yesterday.

To help appease subscribers, Cablevision, followed by Comcast Corp. (CMCSA), Cox Communications Inc., Time Warner Cable Inc. (TWC), DirecTV (DTV) and Dish Network Corp. (DISH) announced today that customers without service due to the storm will receive credits on their television service bills.

Charging Stations

AT&T Inc. (T) was working with New York officials to deploy generator-driven charging stations in the city,Michael Balmoris, a spokesman, said in an e-mail. AT&T and Verizon, the two largest U.S. wireless carriers, invited people to charge their mobile devices at their stores.

Sprint Nextel Corp. (S) also was struggling with power failures in New York and New Jersey, Crystal Davis, a spokeswoman for the third-largest carrier, said in an e-mail. In New York City, about three-fourths of the network was working, Davis said.

Sprint’s networks were fully restored in seven states and the District of Columbia, she said. More than 90 percent were operational in four more states, and 80 percent were restored in New York, New Jersey and Connecticut.

T-Mobile USA Inc.’s network was “close to normal” outside of lower Manhattan, the fourth-largest U.S wireless carrier said in a statement.

To contact the reporters on this story: Todd Shields in Washington at tshields3@bloomberg.net; Scott Moritz in New York at smoritz6@bloomberg.net

To contact the editors responsible for this story: Bernard Kohn at bkohn2@bloomberg.net; Nick Turner at nturner7@bloomberg.net

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