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Frontier Communications is formally asking the California Public Utilities Commission for permission to buy Verizon’s copper telephone and fiber-to-the-home systems in the state. It’s part of a bigger transaction that includes Verizon’s wireline operations in Florida and Texas.
The California piece is big, involving 2 million subscriber phone lines plus broadband and video accounts. It should also result in better service for people who live in the rural areas where Verizon is letting its copper rot on the poles.
I’ve worked on several projects in Verizon’s copper service areas. If you’re an independent ISP trying to get a grant from the California Advanced Service Fund (CASF), Verizon is pretty much a slam dunk: it’s usually not hard showing that it can’t deliver broadband service at the CPUC’s minimum service level of 6 Mbps down and 1.5 Mbps up. In Taft, a small town on the western edge of Kern County, Verizon never even upgraded its system to provide first generation DSL service.
Frontier has gone after CASF money itself and has promised the CPUC it will upgrade some of its systems with its own money. On the other hand, there’s a limit to what it offers most of its customers, and the proposed new standard of 25 down/3 up is largely out of its reach. And beyond the capacity of the antiquated copper systems it wants to buy from Verizon. Still, Frontier will be an improvement over Verizon in rural California, as the filing points out…
Although Frontier has not yet formulated a detailed plan for broadband enhancements in the Verizon California service areas after the Transaction is completed, Frontier expects to invest in enhancing broadband speeds and service in the acquired territories. Frontier has participated in the CASF and [federal Connect America Fund] programs already to assist in broadband deployment. To the extent that it can, Frontier will utilize the CASF and CAF programs, coupled with its own investment, to expand and enhance broadband services in the Verizon California service areas.
The to the extent it can weasel words notwithstanding, it’s a good start to the transaction review process. The application is in the hands of an administrative law judge now. The deal doesn’t pose the same monopoly concerns as the proposed Comcast-Time Warner-Charter menage, so approval is likely to come within in a few months. Even so, the CPUC might – should – review it with some of the same questions in mind, and particularly consider adding requirements to offer broadband service in existing service areas, if not upgrade them to minimum broadband service standards.