Vt. threat to pull telecom's license 'not a bluff'

Wed, 09/09/2009 - 8:05am
Dave Gram, The Associated Press

MONTPELIER, Vt. (AP) – FairPoint Communications has a challenging couple of days ahead: It must explain its service problems in a hearing Wednesday with regulators from the three states where it provides phone and Internet service, and it has a Thursday deadline to tell why its license to operate in Vermont should not be revoked.

The Vermont office that represents consumers filed a petition with the state last month demanding to know why FairPoint should be allowed to continue operating, given the problems its customers have had since FairPoint took over landline phone and Internet service for Vermont, New Hampshire and Maine from Verizon Communications in February.

"It's not a bluff," said Stephen Wark, spokesman for Vermont's Department of Public Service, which represents consumers before the state Public Service Board. "We went in this direction because we felt it was critical to get the answers that we needed." Wark added that while the move is a shot across FairPoint's bow, he did not expect to see the company run out of Vermont.

"We're talking about 'show us that you should be able to keep'" the license, he said.

States have revoked a company's license in the past, said Brad Ramsay, general counsel with the Washington-based National Association of Regulatory Utility Commissioners. But he said he could not recall it happening with a company with as large a presence in a state as FairPoint's 80 percent of the landline phone market in Vermont.

Regulators in New Hampshire and Maine have been reporting similar problems with FairPoint: billing errors, service order delays and long waits on call-in complaint lines. Only Vermont's consumer advocate has formally said the company's license should be on the line.

FairPoint spokeswoman Beth Fastiggi said the Charlotte, N.C.-based company was making progress and would describe that progress both in the meeting Wednesday in Derry, N.H., and in its written filing with the Vermont board.

"Our network has performed very well," she said. "Processing orders (for service changes), we had a lot of difficulty doing at first. But for the most part, we can process basic types of orders now."

Maine Public Advocate Dick Davies, who represents consumers before his state's utilities board, said his office has been pushing FairPoint to hire consultants to help with its computer systems.

Vermont's petition raises the question: What would happen if the state were to determine that FairPoint isn't up to the job of running the state's largest phone network and providing Internet service to thousands of homes and businesses?

"You've got to have somebody who can run the phone company, provide the services," Davies said. "It's a pretty complicated process and the reason why it's taken so long to put something in place."

FairPoint, which paid $2.3 billion to Verizon for the phone networks in the three states, also has a strong interest in keeping the property, Davies noted.

"The state can't deprive them of that very easily," Davies said. "You'd get a wicked fight from both the company and the people who financed them."

Peter Bluhm, a former telecommunications analyst with the Vermont Public Service Board, said even if FairPoint were told its license was being revoked, it likely would be required to stay on the scene until a replacement company could be found.

"FairPoint can't stop providing service until it gets permission to stop – that's called exit control," Bluhm said. "Unlike dry cleaners and car mechanics, utilities are not just free to close up and stop providing service."

More Broadband Direct 09/09/09:
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•  OpenTV to open measurement platform to developers
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•  NDS brings pre-paid option to TV
•  Thomson connects IP to 3G, expands VoIP options
•  Tek announces tester for IP network QoS
•  Goldman cautious on pay-TV services
•  Sprint to offer Palm Pixi, Pre price cut
•  Report: Hulu spurs growth of Internet TV
•  Vt. threat to pull telecom's license 'not a bluff'
•  Broadband Briefs for 09/09/09



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