CHARLESTON, W.Va. — The state Public Service Commission says Verizon can purchase Frontier Communications in West Virginia but it has to agree to improve service for traditional phone customers.
The 14-page PSC order, signed Friday, includes a required $60 million investment into an escrow fund for customers who still get service through copper wires.
The order said Verizon must agree to provide “plain old reliable phone service” where fiber is not currently available.
“These (escrow) funds may be spent to upgrade the current POTS copper network or through the use of other necessary equipment to provide adequate service to both new and existing customers,” the order said.
PSC Chair Charlotte Lane warned in a June hearing that any deal between the two companies had to include consideration of traditional phone customers.
“I am hoping the settlement is going to address what Verizon plans to do with landline service and how much money you’re going to put into the current problems we’ve all known landline customers face,” Lane said.
Verizon Vice President of Consumer Sales and Service Tom Nugent testified in that June PSC hearing that Verizon would provide better service than Frontier.
“There will be disruption in service that they currently experience. From a customer experience, we take tens of thousands of calls a day on the consumer side and we’ve got the breadth, the skills and tools in order to support them in any calls they may have,” Nugent said.
The PSC concluded approving the agreed-to deal between the two companies without the additional investment would be unfair to customers who don’t yet have fiber to their homes for phone and broadband.
“Approving the transaction without conditions would unduly favor utility interests at the expense of customers who depend on copper for POTS and do not wish or cannot afford alternative services,” Friday’s order said. “Requiring Verizon to fund a $60 million escrow account for the specific purposes as discussed herein restores this balance by safeguarding customers while permitting the efficiencies of the Acquisition.”
Frontier acquired Verizon’s landline service in West Virginia in 2010. Frontier has struggled to maintain the system with the PSC fielding numerous complaints about poor service, especially in rural areas. The struggles have also created concerns over impact to 911 systems in West Virginia.
The companies announced plans last year for Verizon to repurchase in several states what it sold to Frontier. Regulatory approval is required in each state.