Despite outside concerns about its finances, Frontier Communications Corporation will take over Verizon Communications' phone landlines by June and promises to increase Ohio's broadband lines by 25 percent.
The Public Utilities Commission of Ohio approved the takeover in Feb. 2010 after an eight-month-long review of Frontier.
Frontier Vice President Dave Davidson said the plan is to increase the number of access lines in Ohio from 60 percent to 85 percent after the transition in June. He said once the transition takes place, he hopes the company will increase the number of phone lines to 635,000.
Currently, Verizon has 613,000 phone lines in Ohio, said Christy Reap, a Verizon spokeswoman. She declined to say how many phone lines run in Athens.
Plans for Athens
Frontier has promised to be good neighbors and improve wire line service
Athens County Commissioner Larry Payne said. If the company makes the improvements they have promised it should be a plus for the area.
Most of the city of Athens uses the current Verizon lines for broadband, but others use wireless Internet, he said.
IntelliWave provides wireless Internet to eight counties in Southeast Ohio, said Chris Cooper, IntelliWave managing partner. He said although the two companies would provide different services, there would still be competition for customers in an area such as Athens.
Frontier's goal is for more people to have Internet access in the state, Davidson said. In many rural parts of Ohio such as Athens, that will be difficult.
We believe broadband is a quality of life he said. There are many things you can do with broadband that you can't do without.
He said in Athens, there will be a general manager to handle the needs of the customers.
Application Dispute
Frontier bought the Verizon broadband phone lines for $3.3 billion, according to a Verizon news release. Verizon sold the lines in order to concentrate on the urban population.
The Public Utilities Commission of Ohio began reviewing the company switch in May 2009 and received motions to intervene in the application process by groups such as the Ohio Consumers' Counsel, the International Brotherhood of Electrical Workers Local 986, the Communications Workers of America, and Comcast Phone of Ohio, according to documents from Frontier's application review.
The groups expressed concerns about Frontier's financial ability to own and operate Verizon's landlines, citing that Frontier's revenue is steadily declining and that Frontier pays high dividends to shareholders instead of investing in the communications network, according to documents from the review.
Frontier denied the claims.
Frontier is very profitable
Davidson said. This transition will only make us stronger.
The groups were also concerned because Frontier didn't make a field visit to Ohio prior to the purchase, according to legal documents. Frontier also bought Verizon only three months after its original exploration of the purchase.
Davidson said this claim was unwarranted and that Frontier has made many visits to Ohio before and after the transition was accepted.
In response to the complaints, the Commission held six public hearings around the state, including one in Athens, according to documents from the review.
Upon further review, the Commission approved the transition and created four stipulations Frontier will need to follow during the next three years, according to the documents.
Frontier will need to increase the number of homes with broadband access lines from 60 to 85 percent, make investments in Verizon at an annual rate of $110 per access line or $50 million overall every year, maintain Verizon's previous phone line rates and record its performance with the Commission for the next three years on a quarterly basis, according to the documents.
If Frontier fails to maintain the stipulations for any two years of the commitment, the company could be subject to a $100,000 fee paid to the state per stipulation, according to the review's documents.
With the transition, 1,000 Verizon employees will be transferred to Frontier for at least 18 months, Davidson said. He would not comment on the employees' statuses after 18 months.
Katie Simko contributed to this article.
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Alex Stuckey
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