Verizon/FairPoint Deal Not Wowing Consumers

While Verizon is still pushing its FiOS (Fiber To The Home) services to its customers, it is seeking to shed itself of some customers it thinks won't be profitable enough. Many of those customers are in northern New England.

Verizon wants to sell its landlines and customers to FairPoint Communications, a telecommunications company that specializes in providing rural broadband services. At first, it seemed that such a sale might be a good thing for Maine, New Hampshire, and Vermont because Verizon wasn't interested in expanding its fiber optic network very deeply into these rural states or providing alternative broadband services like DSL. The sale is contingent upon the blessings of the Public Utilities Commissions and legislatures in each state as well as federal regulators.

At first it seemed that it might be a slam dunk, but recent events may prove to be the undoing of the deal.

A series of public hearings have been scheduled, with many of the public showing their skepticism about the deal. Many have questioned FairPoint's financials, wondering whether the company will have the capital necessary to carry through its plans to bring high speed DSL to all of its customers.

The deal has drawn reactions ranging from wariness to outright opposition from legislators and even from some of the people FairPoint is promising to help.

"Nope," Suzanne Isabelle said to the FairPoint deal in an accent that revealed her French-Canadian roots. In an interview at the Norton, Vt., customs brokerage where she works, she added, "It doesn’t sound as if FairPoint has the backing or the money to change things to improve what we’ve got. We’ll either stay at what it is now or go downhill."

FairPoint has already stated that if one of the three states votes against the sale, the deal is dead in all three. Some skeptics have stated they don't believe that FairPoint will be able to upgrade northern New England's telecommunications systems to a level necessary to provide the services that its customers want, fearing that FairPoint's reliance on DSL alone will mean that the three states will fall farther and farther behind the rest of the nation when it comes to available bandwidth.

"DSL is going to be obsolete technology in five to 10 years," [Vermont State Senator Vincent Illuzzi] said. "We want state-of-the-art technology brought in here."

As do the rest of us. While the cable companies are doing their best to upgrade their systems to accommodate the demand for more bandwidth and for “triple play” services – phone, Internet, and video – cable service is not nearly as universal as telephone service. In many rural towns a number of residents are unable to get cable service because the cable operator won't build out their systems to cover one or two customers living some distance from their coax lines, nor are they required to. Plain old telephone service, however, is required to be provided to everyone wanting it. That's where companies like FairPoint can make a difference, but only if they have the financial ability to do so.

While I was a supporter of the idea initially, I have to say that I now have doubts about this deal and what it means for telephone and broadband service in all three states. This is something everyone in Maine, New Hampshire, and Vermont will have to think about long and hard before giving the go ahead for such this deal. A wrong decision could end up costing everyone here a great deal of time, money, and aggravation.

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