CAPEX, QOS, RATES POSSIBLE STICKING POINTS IN VERIZON-FAIRPOINT DEAL

摘要

Verizon抯 plan to spin off landline operations in northern New England will see close scrutiny by state regulators in Me., N.H. and Vt. -- whose approval is needed for the $2.7 billion sale to FairPoint Communications. Capital investment, service quality and rates will be the major issues, we抮e told. FairPoint is known to regulators in those states as the 2nd- largest incumbent telco in Me., with 6 operating companies and 50,000 lines. It has a company with 5,000 lines in Vt. and one with 500 lines in N.H. FairPoint will balloon with the transaction. The company has about 285,000 lines in 18 states. Verizon has about 525,000 lines in Me., 600,000 in N.H. and 325,000 in Vt. This situation has some officials asking if FairPoint has the resources to maintain network investment and service quality for the acquired Verizon properties. nnMe. PUC Chmn. Kurt Adams said the main legal standard for merger reviews in Me. is 搉o harm to consumers.?He said the 揵urden is on Verizon?to show that this transfer meets that standard. With capital investment, service quality and rates big bones of contention in Me. PUC utility merger reviews, 揑 expect these to figure into this one as well,?he said. David O払rien -- top official of the Vt. Dept. of Public Service, the autonomous utility consumer advocacy agency -- said this spinoff 搃sn抰 necessarily a bad thing for consumers. Vermont is a marginal market for Verizon but will be a major revenue source for FairPoint. This could translate into much more attention being paid to this state and its telecom consumers. N.H. Asst. Consumer Advocate Ken Traum said a small rural carrier like FairPoint might better serve former Verizon customers, because for FairPoint N.H. would be a large market, whereas the state is marginal for a giant like Verizon, he said.