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PSC Consumer Advocate recommends rejecting Verizon, Frontier Deal
Posted Monday, November 16, 2009 ; 05:42 PM | View Comments | Post Comment
Updated Wednesday, November 18, 2009; 07:10 PM

The State Consumer Advocate Division recommends the state reject the Frontier Communications deal to take over Verizon Communications’ landline operations in West Virginia.

By Walt Williams
Email | Other Stories by Walt Williams

CHARLESTON -- The state Consumer Advocate Division believes Frontier Communications hasn’t done its homework in agreeing to take over Verizon Communications’ landline operations in West Virginia and recommends the state reject the deal, according to testimony filed with the state Public Service Commission Friday.

The division said Frontier hasn’t fully analyzed the condition of Verizon’s properties, and as a result it would inherit a substandard communications systems resulting from years of neglect. It also said the business model Frontier is pursuing puts the company at financial risk.

Frontier has proposed acquiring Verizon’s landline operations in one of the largest telecommunication deals in state history. If it were to go through, Frontier would pick up significant portions of the state while Verizon would essentially get out of the landline business and instead largely focus on cell phone service.

The deal must first receive PSC approval. As part of that process, the Consumer Advocate Division reviewed the proposal and raised several concerns about what it found. It recommended PSC reject the plan.

Division Director Byron Harris wrote that Verizon has provided years of substandard service in the state by neglecting upkeep of its landline system.

The division was not sure Frontier had the resources to do the necessary maintenance work.

It noted Frontier would pick up 600,000 additional customers to the 140,000 it already services in West Virginia. However, the company has not addressed how it would upgrade its customer service center to handle that increase in volume, according to the division.

The division raised questions about Frontier’s ability to expand broadband access in the state should the merger go through. It also took issue with a provision it said shields Verizon from any consequences of the takeover.

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User Comments [ post comment ]
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Mark
9/7/10 at 9:30 AM
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I switch over and have been with Verizon (bundle plan) or triple play for almost one year. TV, home phone, internet. It was a litle cheaper then the other providers. Plus they was given away a camcorder or a laptop computer by dell. I wanted the camcorder which I NEVER received from Verizon. Now, it is Frontier? Who is Frontier plus they up my price to almost $50.00 dollars more! I am so outraged by this and Verizon broke there contract with me. Looking now for a cheaper service or just drop Frontier completely. Cannot afford there prices..Called Frontier Customer Service and she said she could drop the price $15.00 dollars but there would be a charge for changing services which is in November. Dah! Nope not paying anyone who was on a contract deal and then charge me for Verizon changing or being bought out by a company that is way to high with prices. Nope not going to fall for this one. Sick of getting the run around with these phone companies!
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Toby
11/17/09 at 7:09 PM
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Since when is a utility not allowed to run a great company almost into the ground, lose 3 billion, and dump that debt on the next willing company? Frontier can turn it around! I say let it pass and set a precedent for gas, electric and others. Let them run our infrastructures in the ground and cash out! Git out of our way, big guvyment. In all seriousness, if its denied, I hope the PSC stays on them and forces them to get their business in order before cashing out. This type of situation is precisely why some government oversight is needed. I am sure as stated above Verizon is confident it will benefit once its reviewed again. They have deep pockets and an army of lobbyists to wear the politicians down.
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Ron Collins
11/17/09 at 2:36 PM
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This deal is bad for West Virginia! There is no way Frontier will be able to sustain their business model. Phone user’s in the state will be impacted. There will be job loss in the state, the job loss will have a negative impact on the entire economy in West Virginia. While Verizon walks away with 3.3 BILLION tax free cash - shameful! Corporate Greed! Verizon has an obligation to West Virginia. Don't miss one huge point from yesterday: In addition to the CAD asking the PSC to REJECT the deal, the Public Service Commission staff also recommends the commission REJECT the deal.
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WV Consumer
11/17/09 at 10:11 AM
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How will Frontier afford to repair and replace all of the antiquted phone lines? Im not sure I beleive that Verizon is currently investing in the WV infrastructure. Since Verizon rolled out the Fios service in the surrounding states the WV technicians have been sent to VA and MD to try and keep up with the demand of the new Fios customers. I personally agree with that plan but dont come out and mislead the WV customers. Tell them that Verizon has decided to focus their attention and efforts on the future of the company, Fios. What happens when Frontier takes over and has to pay these high wages of the current Verzion employess? They will not be able to afford to maintain and repair the current infrastructure. One thing is going to have to give, either the customers will have to deal with shoddy service or the employees will have to take cut in pay and benefits.
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Holly
11/17/09 at 8:57 AM
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I agree that Frontier cannot be any worse than Verizon. Verizon has been horrible to deal with. When acquiring about when we will get high speed internet, they actually laugh and tell us not in our life time. I recently sold a house and the chaos that I and the new owner went through to get the phone service changed was unbelievable. I have dropped Verizon all together and simply use my cell phone and satellite service for high speed internet. I gladly welcome a change to our phone service!!
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Harry Mitchell
11/17/09 at 8:50 AM
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Harry Mitchell weighing in from Verizon. Verizon and Frontier will reply to the testimony of the Consumer Advocate and others on Dec. 1 as the next step in this process. We believe that, after the Public Service Commission fully reviews the transaction, it will come out -- as the U.S. Department of Justice, the Federal Trade Commission and three other states have -- in support of the transaction and the numerous benefits it holds for West Virginians.

One other point: The Consumer Advocate's references to Verizon's communications network in the state simply are not true. Verizon has invested, is investing and will continue to invest in its West Virginia infrastructure.
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Marv Ice
11/16/09 at 9:12 PM
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Living in the St. Marys area which is served be Frontier, I can tell that we were hoping that Verizon would buy out Frontier. Either way I'm sure that West Virginia will stay in the 19th century.
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Jim Nelson
11/16/09 at 8:21 PM
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It cannot be any worse than Verizon. We finally terminated our land line because Verizon could never get it fixed. I say let Frontier go for it, maybe one day I can have a functional land line installed with high speed internet service. As it stands today, I have neither, so what will it hurt? Verizon gave up on us years ago, so let's get a company in here that is trying to do something and then hold their feet to the fire to do it!

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