Shareholder Proposal on Network Neutrality Gains Momentum in Vote at Verizon
Results Surpass Those at AT&T; Third vote upcoming at Sprint on May 15
A shareholder proposal calling upon Verizon Communications Inc. (NYSE, NASDAQ – VZ) to publicly commit to network neutrality principles on its wireless networks gained significant momentum at the company’s annual meeting as shareholders supported the proposal by an even larger margin than their counterparts at AT&T did in a similar recent vote.
The proposal at Verizon, which was offered and considered for the first time this year, attracted 7.9% of the votes cast by the company’s shareholders at the annual meeting in Huntsville, Alabama on May 3. A similar measure at AT&T Inc.’s annual meeting on April 27 attracted 5.9% of the shares voted. The vote results are contained in official filings by the companies with the Securities and Exchange Commission.
By winning more than 3 percent of the vote of shareholders at both AT&T and Verizon, the proposals reached an important qualifying threshold set by the SEC for inclusion in next year’s proxy voting at both companies.
Based on Verizon’s recent share price, the results mean that investors holding stock worth more than $5.2 billion voted in favor of the resolution.
A similar proposals regarding wireless network neutrality is scheduled for a vote at Sprint Nextel Corporation (NYSE – S) on Tuesday, May 15.
Network neutrality is a core principle that has guided the Internet since its inception. This principle enables an open Internet by making sure that companies that provide Internet access treat all content equally—regardless of source, destination or ownership. This prevents a handful of large companies from paying wireless providers premium rates in exchange for faster speeds on their sites than others receive. Without it, consumers risk experiencing a dramatically different Internet, where large corporate sites able to pay premium costs load and operate at fast speeds while smaller newer sites struggle to function and compete with slower speeds. Numerous studies also demonstrate that network neutrality is important to the prosperity of Internet Service Providers and economic growth.
The shareholder proposals at AT&T, Verizon and Sprint were allowed on the proxy ballots following an SEC staff ruling earlier this year which denied “no-action” requests by the companies. The companies had sought to block shareholders from voting on the proposals by arguing, among other things, that network neutrality was not a “significant public policy issue.” The SEC staff rejected that argument in view of what it called “the sustained public debate over the last several years concerning net neutrality and the Internet and the increasing recognition that the issue raises significant policy considerations.”
The proposals ask each company to publicly commit to operate its wireless broadband network “consistent with network neutrality principles – i.e., operate a neutral network with neutral routing along the company’s wireless infrastructure such that the company does not privilege, degrade or prioritize any packet transmitted over its wireless infrastructure based on its source, ownership or destination.”
For more information:
Michael Connor, Executive Director, Open MIC, 646-493-9704, mconnor@openmic.org
Jonas Kron, Vice President, Trillium Asset Management, (503) 592-0864, jkron@trilliuminvest.com
Laura Campos, Director, Shareholder Activities, Nathan Cummings Foundation, 212 787 7300 ext. 3615,
Laura.Campos@nathancummings.org
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