Verizon suitor makes case for land-line purchase

Published 9:12 pm Saturday, October 16, 2010

EVERETT — Frontier Communications is fighting a public relations battle in Washington and several other states across the country, trying to prove to Verizon land-line and broadband customers that things will only get better if it takes over rural service next year.

The Connecticut-based telecommunications company arranged to buy 4.8 million phone lines from Verizon earlier this year, including those of about 518,000 customers in Snohomish County and other parts of northwest Washington.

The $8.6 billion sale has yet to gain approval from state and federal regulators. If that happens, the sale will be finalized in the second quarter of 2010.

Meanwhile, Frontier is trying to convince future customers that unlike past Verizon sales, this deal won’t turn sour.

“Our biggest challenge is really getting people to understand who we are,” said Steven Crosby, senior vice president of public relations for Frontier.

More specifically, that they’re not Hawaiian Telcom Communications or FairPoint Communications, two companies that recently bought up Verizon land lines in Hawaii and New England. Both companies struggled under the weight of added service accounts, with Hawaiian Telcom declaring bankruptcy in 2008.

Frontier is telling Verizon customers it’s been in the telecommunications business for 70 years — and it’s not going to drop the ball if the deal goes through next year.

“Frontier is a company that wasn’t started two or three weeks ago, or two or three years ago,” Crosby said. “We’ve been around a long time.”

But the transaction would triple Frontier’s size — a red flag for critics of the plan.

Both supporters and naysayers attended a public hearing at Everett Community College on Thursday night, part of the Washington Utilities and Transportation Commission’s ongoing evaluation of the plan.

“My concern is about Frontier growing overnight,” said Verizon employee Steve Walcker. “It’s like going from a child to an adult without the (usual time) for growth.”

Walcker and other Verizon employees said they’re worried by the debt Frontier is assuming with the sale — about $3.5 billion. Others said longtime Verizon workers are concerned about their pensions.

“We’re worried,” said Kevin Morrison of Edmonds. “We’re mostly worried about the pension and whether we get a lump sum.”

But supporters had their time at the microphone, too, with two chamber of commerce presidents from Snohomish County saying they met with Frontier executives and were impressed.

Louise Stanton-Masten, president of the Everett Area Chamber of Commerce, said she liked Frontier’s dedication to developing broadband services in rural markets.

“It’s our observation that they provide a very high level of service to their customers,” she said.

One of Frontier’s top priorities is getting broadband service to rural customers, Crosby said. The company has given thousands of giveaway computers to new broadband customers.

“We’ve been very aggressive in our marketing to get computers into people’s hands,” he said.

He said the company is taking on more debt by buying the lines of Verizon’s customers, but it’s also taking on $4.2 billion in revenue.

And Crosby said rate increases won’t happen.

“We need to be competitive,” he said. “We don’t want to lose customers. If you hurt a customer, that customer will tell 10 people.”

Amy Rolph: 425-339-3029, arolph@heraldnet.com.