FairPoint Communications CEO Gene Johnson was a guest on The Fox Morning News this week to discuss his company's bid to take over Verizon's landlines in Maine. Ray thinks Johnson made his case and that the Public Utilities Commission should accept the deal.
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Ray,
I assume by the way you run your morning radio program that you will more than likely delete this post because it doesn't contain the Pro Fairpoint message that you spew every chance you get.
I have listened to you and your jolly sidekick provide such a one sided argument for Fairpoint over the past few months, and I can only say that I'm sickened by your lack of any type of journalistic integrity, or even a slight willingness to present the other side. Your hatred of anything related to unions so clouds your thinking to anything constructive that they may have to offer.
My calls to your show remain unanswered, my emails are unreturned, and you provide not a single person the opportunity to even call in to your show to speak their mind.
You have Gene Johnson on for 45 minutes straight and throw childish softball questions at him, and constantly try to blame everything on the big ol bad unions.
Let me educate you on so much of what you obviously don't know.
It's not only employees that are opposed to this deal. The three sitting State Senate Presidents, the Three speakers of the house, the governor in Vermont, the three Office of consumer advocates, the PUC staff in both Vermont and New Hampshire, as well as a large amount of other politicians in all three states have strongly against this deal.
Without once mentioning anything to do about jobs, or pay, or benefits they have pointed out many glaring deficiencies in this deal.
Let me point them out to you.
1)Over the past 7 years Fairpoint has bought telephone exchanges in many different parts of the country. Each time they promised the politicians and residents access to the best technology out there (DSL and IPTV) They also offered jobs, and increased community involvement. Nearly every transaction ended with call centers closing, local economies suffering, and promises be broken.
(Look up transactions in Texas in 2000, Call centers closing in Kansas, washington, new york, Maine, ohio, and elsewhere. )
2) Fairpoint promised IPTV to residents in Kansas over two years ago when they bought an exchange there.... it still hasn't happened.
3) Fairpoint became an IPO because they were going to go bankrupt. Its a fact... look it up
4) Fairpoint has had to borrow 10's of millions of dollars to pay out dividends to it's investors because it's lofty plans of making loads of money never made it fruition. That money could have been borrowed to actually install a better product.
5) Fairpoint has a history of bad service (in your own state they have the highest complaint rate...double that of Verizon)
6) Fairpoints' business model can only exist by continually buying new properties. With the immense amount of debt they will be swallowing with this deal they will not be able to buy companies for at least five years.
7) Copper based technologies are Maxxed out. You can only send so much information over a 22 gauge wire, and you can only send it so far.
8) Fairpoint has never experienced competition from cable companies in the way they would if this deal is approved. They will go from a 35% competition rate to over a 50% rate. They WILL lose to cable companies just like Verizon has
These are quite honestly, only some of the reasons.. I'm actually trying to keep this post short but your one sided rants, in conjunction with Gene Johnson inability to engage the public is astounding. Once, just once, I wish you would have the resolve to give someone that knows what they are talking about a chance to speak out. I would bury you in a debate about Fairpoint, but in your cowardly little way you're going to avoid it.
Prove me wrong.
Ray,
I to would like to see you reply to these question.
Its pretty easy to look intelligent about an issue when the only people you allow to voice an opinion is the ones that have the same views as yourself.
You call yourself a journalist, but to me your just a hack hiding behind unanswered emails and phone call hang ups.
Why dont you Stand up and be a man for once in your life and debate this issue with someone that actually has some facts? or are you afraid to show your true ignorance of this subject to the public?
You, of course, must be kidding.
Neither of you, if in fact there are two of you, had the decency to state your name and what position in the union you hold.
By the way, I am not a journalist and have never claimed to be. I am a commentator who gives the audience my opinion based on my research and conclusions.
I had the union on first regarding this issue and it was the same ole fear and smear that ALMOST always comes from those who are more worried about protecting their status than seeing our state prosper.
You need to understand two things.
One, I do not debate those who hide in the shadows behind a fake name.
Two, it is not me you must convince, it is the Public Utilities Commission whose charge it is to decide this issue.
By the way, the nasty, hate-laced emails and calls from your brethren do not frighten me.
I don't hate your organization. I simply have no respect for it.
Ray,I am, of course, NOT kidding.
it is amusing that you something you feel the need to mention twice is the need to leave my name. What you may or may not believe is this: I don't leave my name because in doing so I fear severe repercussions from my employer NOT from the union. If you so desperately want a name, call me Joe. As for my position, I'm just a regular joe worker at Verizon. (again, I don't see why that matters.)
When you say you had someone that was against the sale could you tell me when that was and how much time they had to speak? And then please let me know how many times you had Fairpoint supporters and the time they had to speak. I would be that the time you gave them is not even close.
The difference between myself and the union is something that you seem to not be able to see. I speak for myself. I speak as a family man, as an employee, and as a consumer. You automatically assume that because an employee is part of a union that they must follow lock step like lemmings. While it is true that many of us believe this sale is not a good thing, we all have opinions that vary, it's called "independent thinking" and believe it or not people other than yourself have that ability.
And while your talking about "the same ole fear and smear that ALMOST always comes from those who are more worried about protecting their status than seeing our state prosper I would point out that EVERY time you mention the sale you reduce it "the union", and even now you refuse to debate with the facts. You only try to point out that I didn't give my name, great debate strategy there Ray! And then, of course, there is Gene Johnson repeating over and over and over, "675 jobs, expanded broadband, and possibilities galore". The last time he was on your show he refused to take calls, which like you, shows me he is afraid to face those of us that know how actually read through the double talk and lawyer speak and actually see the facts.
And as to your commentators integrity, it is glaringly obvious that you are among the most biased "commentators" out there. I find it amusing and annoying that you "comment" on this sale with only one thought in your mind, "unions bad".
As for your lack of respect to the unions is returned ten fold. In my experience even the most liberal or conservative thinkers at least have some room for reasonable thinking, which it seems, you do not.
Lastly, How 'bout that Vermont decision?
Look, you missed the point, but that is fairly typical.
I don't know who you are or what or whom you represent. You say you are an "average worker," a typical Joe. For all I know, you could be head of the union.
You also missed the point on the journalist/commentator issue. A journalist reports facts absent of bias (or at least they are supposed to). A commentator gives you their opinion.
You pithy comments will not goad me into a debate, nor will the nasty emails and phonecalls from what I assume to be so many of your brethren (unless it is all your handy work).
I consistently have the "other side" on for all sorts of Maine and national issues. It is laughable that you think I would run from the vaunted "Verizon union."
The difference between the "other side" and your union pals is that in the other debates/discussions issues, the "other side" conducts itself as a gentleman, recognizing the need for spirited, civil discourse.
It is a consistent and interesting trait that whenever I discuss an issue and take a strong side against the a union (state employees, Verizon, etc.) that the "hate mail" gets more nasty, the phone calls are more disgusting and the comments to my children when in public are rude and upsetting to them. It is nice that your brothers and sisters think it is appropriate to walk up to one of my children and tell them how bad their father is because he wants to make this guys children starve at Christmas.
When I discuss taxes, health care and economic prosperity and have strong differences with the Democrat legislators, these things DO NOT happen.
I am one lone voice. The problem for you all is not that I disagree. The problem is that for the first time in Maine, you do not control the media and have it all running your way as you have for the last 50 plus years.
I have made my reasons for supporting Fairpoiint very clear, on my show, in my newsletter and in my newspaper column. You can see them at myfoxmaine.com
I am not for Fairpoint because the unions are against. For me, that is only a side benefit.
Ray,
I assure you I am not the head of the union, I'm just an everyday Verizon employee, you can choose to believe that or not, I really don't care.
As for me goading you into a debate, don't use any type of excuse that I am sending hate mail, or calling up and being nasty. I am doing neither. They only thing I am doing that you may dislike is pointing out your bias, and your inability to actually debate with someone that does not have to be nasty or mean or hateful.
You have proven by not answering any question I have asked, or responding to any of the points mentioned that you don't have an argument beyond, "the unions are scared about losing jobs." You can blame it on your weak excuse that you don't debate with people that don't leave their name, or whatever else you come up with, but we all know the truth: you have no real facts or basis for your stance other than your hatred of unions.
What I think is laughable is you're not running from the "vaunted Verizon union", you're running from me, just one person armed with facts that you can't go toe to toe with. That is what scares you. You like to spout off about how bad unions and union members are, yet when it comes time to discuss it, you group us all together and are unable to see us as individuals. That is what sets you and carpetbaggers like Gene johnson
(damn, press publish button by accident. Where was I?)
Oh yeah, that's why you and Gene Johnson are no different. You hog the airwaves with your message, and you don't allow others to respond, because we all must be wrong.
Without calling you a liar, I would strongly disagree that you only have what you call hate mail and phone calls only when you discuss anything to do with unions. You strike me as the type of person that typically pisses off most everyone he meets. You have that blowhard, I-am-always-right way about you.
Lastly, your assertion that I am mad because I don't control the media is a joke. I started a website (www.verizonvsfairpoint.com/index.php) exactly because Fairpoint was hogging the media in every way possible, and I, as an individual, do not have the money to compete with them in that arena, what I can do though is go to blogs like this and present the facts (I know that's something you're not used to) I have never walked up to one of your children and said a thing, and I find that behavior inappropriate and rude. I would however love to have a chance to tell you to your face how wrong you are, but again, you won't take the chance of being ridiculed in public. You'll use you're little radio pulpit and this blog to try to convince people that you're right and everyone else is wrong.
I hope you enjoy seeing this deal crumble as Fairpoints promises and lies continue to fall apart.
Ray,
If all of the things the Union supporters have posted about the sale are true, and all of the expert witness except those provided by Verizon and Fairpoint, have expressed significant concerns about the sale, how can you refuse to debate the merits of this case? Your excuses of not knowing who we are, implications that we are either the head of the union, and/ or all the same person are ridiculous. Also refusing to debate with those who "hide in the shadows behind a fake name", is equally ridiculous. I will not goad you into debating the true merits of this case, however, I will say I find your refusal to debate extremely suspect.
You are correct, I get a lot of hate mail, none however as nasty as when I am on the wrong side of a union position.
Maybe it is not your union brethren, of course I cannot prove it one way or the other, but every time and I do mean everytime I take on a vaunted union position with a contrasting point of view, the comments to my children begin.
It is disgusting, but something they have almost become accustomed to, although getting accosted while Christmas shopping at the Mall twice was a little unusual. I have taught them to be polite and simply walk-away and they have done so.
I had your little union on for a half hour, first ... as the PUC began to take it up. It was well-publicized.
Gene has only been in studio once and on the phone once.
Your characterization that I have made it the Gene Johnson show (I paraphrased) is a typical gross mis-statement.
I have no financial stake in this deal, other than I want Maine to move forward and I believe this deal will help it happen.
What is your interest and financial stake?
By the way, Vermont's economy is no better than Maine's. We deal with the same myopic thinking here that they do there.
You guys might prevail. If you do, Maine will suffer for it, but your union will still be intact and as we all know, that is more important than anything, including faith, family and community.
You are welcome to this forum and to continue to use it to attack me and my thinking. My children are another case and I would trust that you will call your union dogs off. They are not involved in this debate and attempting to intimidate them with your sob stories is beneath anyone. You can say what you want to and about me. I accept it as a cost of this job. I will, however, defend my children with whatever means is necessary.
I wish you a Merry Christmas and if your side prevails, then I guess the tactics you employ to influence our government will once again have been proven effective.
Of course, if you do prevail, just who is going to make the needed infrastructure investments that this great state so desperately needs?
I am off to shop.
Merry Christmas
Your single thought mind just can't get off the union, can it? There are just so many things you've said in the last post that I have to respond to them individually.
Maybe it is not your union brethren, of course I cannot prove it one way or the other, but every time and I do mean everytime I take on a vaunted union position with a contrasting point of view, the comments to my children begin.
...My children are another case and I would trust that you will call your union dogs off.
I will, however, defend my children with whatever means is necessary.
Ray, I feel for your children. As I've said, they should not be involved in any way, shape, or form due to your opinions. With that said, stop bringing them up. This discussion is not about them, yet you continue to bring them up. I have "no dogs" to call off, I am but a mere person with little if any influence. If there is anyone that I may have influence with, I don't even have to tell them to back off, they know that kind of behavior is not acceptable.
You are welcome to this forum and to continue to use it to attack me and my thinking.
I am not attacking you. I am trying to debate you, but for some reason you refuse to see the difference.
Gene has only been in studio once and on the phone once.
Gene was on the phone for a half hour, and in studio for 45 minutes. How much time did the opposition get?
What is your interest and financial stake?
My financial stake is simple. I'm an employee, and I fear that by having such a substandard company buy Verizon I will not have a job in a year. I WOULD NOT be having these anxieties if another, better positioned company were to buy Northern New England, (such as windstream, GTI, or AT&T). It's not about the company having deep pockets which I'm sure you'll accuse me of, it's about working for a company that has a viable product that more than several thousand rural folks will use.
Of course, if you do prevail, just who is going to make the needed infrastructure investments that this great state so desperately needs?
Verizon will. The PUC already forced them to up the DSL availability by 10% before they leave. They will have spent just as much money in 6 months than Fairpoint was going to spend in two years.
Merry Christmas
And a Merry Christmas to your family. You, on the other hand, I hope you receive a lump of coal in your stocking.
You know, I was just thinking of an analogy that just may allow you to see this in a different light.
Lets say you come into work one morning only to find out that Fox news (or clear channel, or whomever you work for) is looking to sell off every radio station they own in New England. The new company is "Ricky Bobby radio". You have never heard of them so you do some quick research. It appears that they are an All-country-all-the-time radio outfit, and they only send out an AM signal. The only talk morning show they have is about rodeo.
They plan on changing every station in New England to that format, because they believe that as a rural area, we must all want to have country music and nascar piped into our homes 24/7.
Seeing that you and your jolly sidekick realize that you are never going to make it in another market, and your family is well rooted here, you are not happy.
(Now this is where the analogous reality changes slightly. Bear with me
In order for the sale to happen it not only has to have FCC approval, but it must pass state approval. There will be public meetings, time to present facts, etc, etc....
You being the fighter that you are, want to fight this so you can keep your job, but you worry that if your current employers find out, they may fire you.
So you go on the offensive any way you can. You talk to co-workers, you go to meetings, you call other radio stations, (you get the idea). You want to unite your co-workers with your way of thinking because you KNOW that all of Northern New England does not want to listen to country all the time, and secondary to that, you're going to lose your job or talk about bull riding every day.
People accuse you of fighting this only because you're going to lose your job, but you try to convince them that Johnny 16 year old does not want to listen to Bo and Luke Duke radio. They want something better, faster... (you see the similarities I'm sure...)
Then you come up against this pompous ass (we'll call him 'jay') that hates talk DJ's. He can't really give you a solid reason, he just doesn't like them. He thinks that they talk too much. You sometimes feel like your trying to teach the blind to see, but you still keep plugging away....
blah blah blah....
Do you see what I'm talking about Ray? Most all of the employees that work for Verizon see this deal as crap, and NOT because they only want to save their job. They know that Fairpoint is just not a well run TELEPHONE company (Its a great investment company). They know that copper technologies are a dying brand, and they only have another decade at best to squeeze out of them. Fairpoint wants to take the next 7 years doing nothing but use copper. This will be a disaster, and you if you can't see that you are truly blind. I can only think to compare them to Kodak: they decided to go digital only a year or two ago because they held on so tightly to the old way of producing pictures.
Stop generalizing everyone that may happen to work in a union. Don't take the word of one man that says everyone at work is out to get him. (by the way, your buddy Fred has said if this deal goes through he is going to retire. Even he doesn't want to work for Fairpoint). Employees for Verizon know how to think for themselves. The thing is most of them just happen to have the same thoughts when it comes to this deal.
For Gods sake, debate the issues, not the union.
Good Afternoon Ray,
I would like to counter your opinion on FairPoint being a good choice for Northern New England, not just Maine. My view will also be my opinion as I have followed and researched this transaction from the beginning. How I arrived at my conclusion will be based on the following: customer service, quality of service, technology, and financial status.
I will start with customer service. Even though Verizon is not where it should be with servicing its customers in Maine, FairPoint is not even close. As of the closing of testimony with the PUC of Maine, FairPoint has the highest rate of complaint since 2001. This is only side of a business that most people get to see and where they will make any decision from.
Second will be quality of service. Again, Verizon may not be number one, but people do have generally good service even in terrible weather. And we know weather here in New England. Unfortunately, FairPoint's quality of service rates at the bottom, and they do not have anywhere near the number of lines that Verizon has in Maine. How is that going to change if they are adding an additional 2 million lines? As it stands today, all three OCAs feel that FairPoint will not be able to provide quality service.
Third will be technology. Verizon has been slow in getting most of Maine, in fact most of New England, an internet service that keeps pace with today's technology driven environment. But, some of the southern towns in Maine are now receiving Verizon's FiOS service which is second to none. Sorry to say, but FairPoint's DSL service is a thing of the past and unlike FiOS, has measured limitations.
Fourth will be financial status. It should come as no surprise that Verizon has money to burn, but chooses not to spend it where it would to the most good. But FairPoint is highly leveraged and does not hold the same financial comforts that most telecomm businesses enjoy. They are considered extremely risky by the PUCs as evident by Vermont's PSB recent ruling. This is not the type of company that customers can hope to rely upon in the coming years.
Using these four criteria, my opinion is that FairPoint is not suited to be our telecommunications company and therefore this transaction should be denied. I will gladly answer any questions to how I have come to this conclusion as well as to my research. I am hoping that you will give myself and others a chance to give our opinions to your audience as a call-in.
I am a NH resident, a life-long Verizon customer, and a Verizon employee with over 21 years of service. I also will defend my family to whatever means necessary. As an employee and a customer of Verizon, I DO have a lot at stake in this deal. I want the best possible service, not just for my family, but for everyone in New England. Before you bash me for being a union member, I am also a conservative Republican, born and raised as such, and proud of it. I am not afraid to ask questions, but I do demand answers and resolutions.
In closing, I wish you and your family a Merry Christmas and a Happy and Healthy New Year.
Ray,
The fact that some people feel that they need to harass your children is very disturbing to me and completely inappropriate, I would back you 100% on any actions that you took to protect your children. If in fact these people were Union members, I would hope and expect the Authorities and the Union to prosecute them to the fullest extent of the law.
As for you questioning my agenda and identity. I am not, nor have I ever been a member of a Union or employed by either of these companies. If you do an ip address check from where this comment is coming from (which I’m sure you have access too) you will find that I am not using two different sign in names, you will also find that I am not Verizon internet customer, and that I own several small businesses in New Hampshire.
With that being said I am a taxpayer! In New Hampshire and Maine and I have reasonable concern and questions about the ability of Fairpoint to provide the type of security and service in the telecommunications that these 3 States deserve. We have paid Verizon for many years in the form of tax incentives and user fees to provide the residents and businesses with a secure and competitive telecommunications system, in which they have taken that money and invested it into other areas, and not back into these communities. Leaving the residents and businesses of these 3 states with an inferior and antiquated telecommunications system. I believe we deserve and should demand better service! Fairpoint is not the answer to this concern.
With this merger we are allowing Verizon to walk away from their responsibilities as a (publicly regulated entity), of which they choose and agreed upon to supply when they bought our telecommunications services. The facts show that they have not done this!
Instead Verizon chooses to divest itself of the responsibilities to these 3 states and leave us with a company( Fairpoint) that cannot guarantee us anything better then what we already have. Verizon purposes to walk away with our hard earned tax dollars and a present in the form of a 600 million-tax break. (In which you obviously support).
The PUC’S of these 3 States need to stand up and demand Verizon to live up to their agreed responsibilities and serve the people and not be allowed to walk away from their responsibilities as a regulated public entity. Make them aware that we expect the same services as all the other parts of this country. Penalize them to the point that it is not in their best interest to just pay a fine and make them supply the type of service that the people of these 3 states deserve and have paid for.
The fact that you as a (public figure) having the resources that the average person does not have, will not allow any views in the contrary to your own opinions. (Granted you have a right to your own opinions), I am not disputing that fact, will not give the consideration and access (after all your program and licenses are regulated by tax dollars) to people that do not have the same views such as yourself, the time to voice their own opinions. Instead you or your employer (WLOB) chooses to label the people with different views as Union members. I myself find this very insulting; the fact that you believe that anyone other then the Union members would have an opinion on this matter (as stated in your previous postings). Is Bigoted, as I am sure that the other residents of these 3 states as taxpayers that have no ties to the Union would feel.
Thank you for your time and consideration and may you and your family have safe and happy holidays.
Why are you so interested in debating me? I have no say in this issue. The PUC will determine the fate of the proposed sale, not me.
The IBEW has an enormous influence on Maine's Legislature and what happens here, I do not. I am one voice.
Your issue and the union's issue is not with me, it is with the PUC and I believe the public hearings have been well-stacked with union folks.
The merits of this case are simple.
I believe Fairpoint is good for Maine and I trust Gene Johnson.
I believe what he has told me. I accept that they will keep wage and benefit parity for you guys.
I believe he will increase employment by almost 300 jobs in Maine.
I believe he will make the needed investments in broadband, investments by the way that Verizon has refused to make until ordered to in a settlement agreement, so that Maine's economy can move forward.
You do not trust Gene. You do not believe the above statements.
Nothing you can say to me will change my mind. I have done my homework over the last few months since I began to talk about this issue and I am comfortable with my conclusion.
Nothing I can say will change your mind. Your employment has led you to a different place than I am.
I do not wish for you to lose your job, they are too hard to come by in this state and I do not believe you will unless it is for merit reasons.
I think Verizon has abandoned our state and I resent them for it. They are regulated and protected by our state government and they abused the trust and responsibility placed in their hands.
Frankly, I am tired of hearing folks like yourself defend the status quo in this state. The status quo will lead my children to determining that Maine does not offer them a future as an adult.
Many of your brethren have called in over the last few months and brought up the very points you make here. I have addressed on air, in public.
I do not trust Verizon and I do not trust the IBEW. I believe both organizations have done tremendous harm to the long-term future of this great state. Even the examiner's report backs up that statement ...... and it was against the sale.
I actually feel for you, if in fact, your concern is for your family and their financial future and not consolidating even further the union's power base. I do not wish for any fellow citizen to be under such worries.
You have been sold a bill of goods by a seller whose best interest is not in your best interest.
If your side prevails, I trust you will turn your efforts to advocating for needed infrastructure investments by your employer.
The IBEW and Verizon ... one wants to leave Maine as fast as it can and the other only cares about keeping its power with the status quo ..... both are harming Maine's future.
One other note:
For some reason, because I disagree with the conclusions your side has drawn, you believe I am denying your side their say. First of all, I am one person and one station. Second, if our station (on this issue, Ted agrees with the sale) is the only one that has said this is a good idea and promoted it as such, I have no control over what other stations do.
Third, my reasons for supporting this sale have been well-documented, on air and in print. I understand that you do not like the conclusions that I have arrived at, but again .... there are many stations in Maine and New Hampshire. I am sure they do not all agree with me.
I have had dissenting points of view on, but you must understand, this is a talk-radio-show, not point and counter-point where we keep a timer to make sure that all time on this issues is equal.
Free USA,
I am not sure telling a couple of my kids that their Daddy is going to make their children starve, lose their home so that they are cold and is a bad man is criminal, it is just disgusting.
Approaching them while they were standing in line to buy a Christmas present was just a nasty thing to do and it embarassed them ... for something that their old man did.
It is not the first time, however and I am sure it will not be the last.
Thanks for the concern.
Ray
Ray,
First, I would also like express my digust for anyone union or not for accosting your family over your views on this or any other issue. I wish you well and hope you prosecute to the fullest extent the law allows, harrassment is criminal... with that said lets leave the kids out of this one...
Ray do you see many blog sites where people actually leave thier real name??? suppose theres a reason for that??? This is your forum your rules, but there have been some very good facts and questions presented here union or not. You do not, will not or I think, can not offer a reasonable argument to.
Ray you live in Westbrook, thats Verizon service area. Hows the service? Or are you one of those anybody but Verizon and have CATV and CELL phones???
I would also enjoy the debate...
I use cell phones and Vonage. I gave up my regular land line several years ago because of the nasty calls to my children.
I may be an ass and I may be stubborn, but I view this as a debate / discussion, not personal.
It is interesting to me that this particular post supporting Fairpoint has been up for several weeks, yet the activity around it has happened in the last two days.
The money boys on Wall Street like this deal. The money boys are not always right or even good, but they do know money. They say this deal works. I have spoken with several financial folks that have looked at this deal (through the privilege of my job) and they think it make "financial" sense.
The cost per line for this transaction is the lowest in years. And while Fairpoint will have to undo some of the damage Verizon has done with customer relations, I believe they are committed to mending those fences.
Verizon has been unwilling to do what is necessary to move Maine's telecommunications infrastructure in a modern, faster and more accessible direction. That is a statement of fact that CANNOT be refuted. The only reason they are making any investment whatsoever is they are being forced to in a settlement agreement.
Verizon views the landline business as a dying industry and to some extent, they are correct. Urban America is moving to a wireless society, however, the remote regions will long depend on landlines because the wireless infrastructure is not in place and will not be in place in places like rural Maine for several decades.
Face it guys or gals or whichever, what ever point you throw up in support, I can offer a counter point to support my position.
Your heals are dug in and so are mine. I think Verizon is bad for Maine and Fairpoint has the potential to be very good for our future.
You believe other wise.
FreeUSA said, "The fact that you as a (public figure) having the resources that the average person does not have, will not allow any views in the contrary to your own opinions."
That is hogwash. You are currently using this forum, correct? It has my name on it, not yours, whatever that may be.
I have had Gene Johnson from Fairpoint and the local union as guests. Gene twice, the union once.
Oh and I had Fred Staples on because according to Fred, someone placed a noose on his desk as a means to intimidate him over his support for Fairpoint.
Why do you care so much what I think? Do you really believe I am going to influence Kurt Adams?
Kurt is a good man, a fair man and one who will vote to do what he believes is in the best interest of Maine. He will do this based on the facts of the case, not my commentary.
I spoke with a financial analyst that is well-known throughout this country ... off the record about what he thought of Fairpoint. He said he thought they were a good company, financially solvent and whose acquisition of Verizon would be a good move for Fairpoint and help bring Northern New England into the technology age. I have followed this particular person for years and he is well-versed in this arena. I trust his judgement and accepted it at face value.
You all may prevail. The IBEW is very strong and well-organized. They have done a very good job at presenting their case. In fact, the only place they have not had influence is M-F 6a-9a on LOB and FOX. I don't buy what they are selling.
They are trying to save a few jobs. I am hoping to save a state's future.
Verizon is part of the disease that is making Maine's economy sick, it is not part of the cure.
If the Fairpoint deal fails, they will only look for another suitor.
Fairpoint may not bring a cure, but I believe they will work hard to develop one.
So, even though I said I would not debate this stuff with nameless folks, I guess I have.
The financial analysts I have spoken to say that Fairpoint is sound and capable of making this deal work.
They also say that Fairpoint will have the resources available to make the needed investments into Maine broadband infrastructure.
I trust these folks. I took that info and asked Gene questions, both on and off the air. Gene satisfied my curiosity.
By the way, answer ... any of you.
Why would Gene Johnson want to wreck his company? Why would he want to bite off more than he can chew and run Fairpoint in the ground?
Why would he go through the hell the IBEW has put his company through? He birthed this business and when you do that, it becomes apart of your identity. I have owned several companies over the years (small ones) so I know how it feels. You protect that business and you sacrifice for it.
Why would Gene Johnson want to wreck Fairpoint by coming to a region of the country known to be hostile to business? Maine and Vermont as consistently ranked in the bottom five for business climates. Why come to a place that is already difficult enough and then do it with a plan that won't work?
The answer is, you would not do that. You would only make such an investment if you were certain you had a business plan that could work and help make your company more prosperous.
The dye is cast on this one. The only thing is, we do not yet know whose name will be on it.
In closing, this is what I believe.
Fairpoint is financially sound with a business plan for M, NH and V that makes sense. I believe they will make needed investments in the region that will become a foundational piece of moving this region into the technology age.
I believe Verizon has betrayed the responsibility it accepted as a regulated, protected utility. I further believe that if this deal fails, they will not accept it and merely turn their attention to finding another suitor leaving this region to languish in broadband infrastructure obscurity.
I believe the Union will do anything to stop this sale. There is no tactic beneath them. I believe the Union does not give a damn about the future of this region, they only care about preserving thier power. They have an opportunity to prove me wrong by embracing this deal and become an important partner in progress, but they are more concerned with keeping the status quo because it preserves their power and influence.
While I do not wish for a single Maine person to lose thier job, I would love to see their Union destroyed in this fight. Unfortunately, that will not happen and progress, whether in this instance or countless others, will be fought tooth and nail because power and influence is more important than prosperity.
By the way, I have taken an objective view of this situation. I did my homework. I talked with many people much, much smarter than me who have done analysis on this deal. They believe it works.
I do not have a financial stake in whether or not Fairpoint prevails. My judgment on this deal is not clouded by wondering if my job will still be around.
If Verizon wins or Fairpoint wins, nothing will change for me personally.
I have reached my conclusion on this deal, not based on personal self-interest but because my research says it is good for Maine.
You have attacked my integrity on this deal as being biased. It is biased, it is my opinion. I have not, however, dominated the debate on this issue. The debate on this issue has been dominated by the IBEW who stacked public hearings and has attempted to use whatever methods possible to kill this deal.
It just so happens, I disagree with them and I have a microphone they do not control and that is worse than anything.
Nascar88,
I have answered the questions listed. The truth is, the posers do not like the answers because they do not support thier position.
They believe Fairpoint is financially incapable of making this deal work.
The financial boys I have spoken with (not Fairpoints, but respected, unbiased financial boys) beleive this deal makes sense.
Who is right? I believe I am, they believe they are.
Someone prove it.
Of course, unless the deal occurs, no one can prove it one way or the other.
Verizon is not good for Maine. That statment cannot be refuted. They do not even want to be here. The examiner's report said they made a decision somewhere in the last seven years that paying fines was a better business model than making investments. Clearly, that model is bad for Maine.
While I personally believe that landlines will become a thing of the past at some point, that point is way down the road for Maine.
Maine's future is my concern. It is the only reason I do this job. I took it to help bring forward important discussions that were not occuring in Maine. I did not need this job and I am certain my time in the public is short.
I will not sit idly by and allow the wrong thing to happen when I can speak out against it.
Denying this deal is wrong for Maine, period.
Beating the union at its game with its rules is only a side benefit, not my driving force .... regardless of the comments on this forum and elsewhere.
Ray,
Finally, you leave some comments that you believe as fact that we can debate. (even though you don't want to debate.
Lets break them down, shall we?
I may be an ass and I may be stubborn, but I view this as a debate / discussion, not personal.
I really have to slightly apologize. I have made this personal because so often things that you've said (or haven't said) have angered me enough to want to punch my radio. I have let my dislike of your words carry over into this blog. About the coal thing... well, Santa will decide if you've been naughty or nice..
It is interesting to me that this particular post supporting Fairpoint has been up for several weeks, yet the activity around it has happened in the last two days.
Contrary to what you believe, the world doesn't revolve around your blog. I just found out about it a few days ago, and I am constantly searching the web for any information about the sale.
The money boys on Wall Street like this deal. The money boys are not always right or even good, but they do know money. They say this deal works. I have spoken with several financial folks that have looked at this deal (through the privilege of my job) and they think it make "financial" sense.
I'm not too sure who "the money boys" are but I'm sure I can find just as many that are against it. For instance "vectorvest" just downgraded the stock. They were downgraded because their stock is believed to be worth only $11.50 at most. And when JP morgan upgraded the stock they said that it would be approved before Christmas; That was two days before Vermont said no, and the same day that Maine pushed the date back. And apparently he didn't read any of the NH PUC's release saying that the deal, as written has no chance of passing. But you go ahead and believe your money guys....
The cost per line for this transaction is the lowest in years.
Because Verizon so wanted to sell their lines they were willing to reduce the price. Also, if you read the redacted testimony released in Maine, you will see that Verizon specifically asked Fairpoint how much they could afford to pay. If fairpoint were on better financial ground Verizon would have charged them more. But because they have such shaky finances they could "only" pay 2.7 billion. You should also read into the 240 page Vermont "no". Their main reason for denial was Fairpoints' shaky finances in the past and present.
hey are trying to save a few jobs. I am hoping to save a state's future.
Again, you are mis-informed. The employees are also trying to save a states future. What is it you really think that DSL is going to do for Maine? By Fairpoints own lofty admission they only expect to bring DSL to 50,000 over the next two years. They plan to do nothing to compete against cable modems (which DSL has been steadily losing against at about a 5% rate every year) Think 5-10 years ago, when dial up was pretty much the only game. That's what DSL is going to be considered in 5-10 years from now. Maine, NH, and Vermont will be BEHIND everyone else. All for about DSL access to 90,000 people. (and lets remember, not all of the 90,000 are actually going to use DSL, the take rate is about 25% so Northern New Englands future will be sold out for about 20,000 people.
Verizon views the landline business as a dying industry and to some extent, they are correct. Urban America is moving to a wireless society, however, the remote regions will long depend on landlines because the wireless infrastructure is not in place and will not be in place in places like rural Maine for several decades.
Again, your lack of knowledge is obvious. Do some research on WiMax and satellite technologies. They have the same capabilities as DSL for less than half the install and maintainance costs.
If the Fairpoint deal fails, they will only look for another suitor.
WHO? Name a company that Verizon will choose? Fairpoint was the LAST company available. Other companies of similar size vetoed the deal and would not buy into Verizon sale idea, because they knew it wouldn't work.
Verizon is part of the disease that is making Maine's economy sick, it is not part of the cure.
I think I heard that on "Cobra" years ago...
By the way, answer ... any of you.
Why would Gene Johnson want to wreck his company? Why would he want to bite off more than he can chew and run Fairpoint in the ground?
Gene Johnson has said he plans to retire in the summer of 2008(It was in the Charlotte Journal this past fall). If you have the read the TOS of this sale, you will see that Gene stands to receive a huge paycheck if this sale goes through.. you can call it his retirement fund, regardless if he started the company or not... I DON'T trust him.
I believe the Union will do anything to stop this sale. There is no tactic beneath them. I believe the Union does not give a damn about the future of this region, they only care about preserving thier power.
I believe everything you just said too. Except replace "union" with "fairpoint".
Fairpoint is financially sound with a business plan
We talking about the same Fairpoint? You do know they have a junk bond rating on their stock, right?
The debate on this issue has been dominated by the IBEW who stacked public hearings and has attempted to use whatever methods possible to kill this deal.
Perhaps you didn't see the buses pulling up the parking lots in Maine with Fairpoint people in green shirts stepping off them? The union told or asked NO ONE to go to a single meeting. Employees that went chose to go on their own accord. No one wore any shirts, or read from papers with the Fairpoint logo at the top. Don't twist the facts.
Ray, all in all, your opinion is backed up by facts that don't exist. Your use of a microphone is your choice, and your job. Continue doing it. You only show everyone else your lack of any factual basis for your opinions. When this deal fails, and a couple of years later when Verizon expands DSL to rural areas and expands FIOS in the southern region of your state you will still find something to complain about I'm sure.
Go ahead, try to prove me wrong, but instead, use facts this time. Stop saying that it's your opinion.. back your opinion up with facts, otherwise it just proves your ignorance.
Actually, my ignorance is discussing this with you.
I can provide countless people to back up what I have said, respected industry experts.
This debate is about who you trust.
We do not trust the same sources, therefore our conclusions are different.
This discussion is a lot like the global warming debate, whose opinion do you trust?
I have taken the time to research this issue, talked with people whose opinion I respect and whose opinion is widely respected. I turst their take on it.
I don't know you, know who you are or what your interest truly is here.
You might simply be some damn liberal who hates my show and wants to argue here because it is only media in Maine that you cannot dominate, OR you might be a truly concerned person who like me is only looking out for what he/she believes is in the best long-term interest of Maine's future.
You did not refute anything I said, you simply offered opinions from people who are countered to what I believe or counter to the people whose opinions I trust.
No my friend, I do not think the world revolves around my blog or my show. I am always surprised that anyone would care what I think.
I do find it interesting, however, that this post sat idle for a few weeks and then "suddenly" was discovered by three or four people who randomly decided to post here at roughly the same time .... don't you .... yeah, probably not.
Give me a break about public hearing stuff, if you really believe what you wrote about there being no effort by the union to bring out members to the hearing, then I am done with this discussion because you are either willing to lie to make a point or you are so wrapped up in your dogma you are unwilling to see the truth.
Several of your brethren called into my show to remind members to speak out. I saw several email changes urging the same.
Yeah, no organization work going on, just concerned people who happen to belong to the group doing everything in their power to kill the deal.
That is why I cannot stand unions. They cannot even be honest about their activities. It is okay that they organized opposition ..... I have no problem with that ..... I urged everyone to speak out in support, just as I did for Plum Creek.
I did not hide I was doing it. I did it openly and gave my reasons for doing it.
By the way, I did not realize I borrowed a line from Stallone, so if I did, I give him full credit for the paraphrase.
By thw way, I just saw in your first post that you say calls to my show remain unanswered. Look, I am sorry that I do not have a "hotline" for Fairpoint opposition, but getting through on the show is a crap shoot, luck of the draw. The screener does not tell me who it is upfront unless it is a scheduled guest.
If you do not get through on the air, I am sorry, but no more so than for any of the other folks who try to get through.
By the way, do you call in as Publius?
As far as your statement that we do not provide a single person the opportunity to even call in and speak their mind .... that is an outright lie ..... we take 40-50 random calls a day on average. I have been discussing this for the better part of three months. With roughly 22 show days a month, you do the math.
Again, I will ask you. Why do you care what I think? It is only my opinion.
Your opening comment to this things, however, says it all.
"From the way you run your morning show," what because I have an opinion and do not care or fear what others think of it.
Because I do not couch my comments other than to attempt to avoid profanity.
Talk radio is all about opinion, strong opinion that provokes discussion and debate.
I have strong opinions about everything and I have never been afraid to say what I think. I believe what I believe and someone's opinion is not going to shake what I think.
I have never understood why someone would get so mad at what I say that they would confront my kids, send hate mail or death threats.
I have had people break up my car, key my van and leave notes at my home.
I find it pathetic, but accept it as part of this job.
Your comment, "I want to punch the radio." Why, because I disagree with you ... so what? It is just my opinion.
I would never deface someone's property or confront their children on something they said about a public policy issue.
Yea, though I walk through the valley of the shadow of death, I will fear no evil.
I interpet those words as comfort and they give me confidence.
They are why I do not waver on the stuff I discuss. I am consistent. Some may say consistently wrong, but I am consistent none the less.
Rather than ruining your Sunday and the Christmas season, lets agree to disagree.
The foundation for your belief and the foundation for my belief do not match.
I will not change your mind and I assure you, you will not change mine.
If the deal fails, then I will crusade for the PUC to impose severe penalties on Verizon for a breach of trust and responsibility as a regulated and government protected utility.
I am doing this job, with the short time I am given, to help move our state forward by discussing important issues that no one has been willing to approach.
God knows our elected folks cannot see beyond their next election and therefore will not do anything that the citizenry doesn't force upon them.
The only and I do mean only leaders Maine has are the average citizens, who when they finally get enough will force change.
I am simply trying to provoke them to get their fill faster.
Ray,
I've touched a nerve, haven't I?
You prove your ignorance in so many different ways other than talking to me. (even though that statement doesn't make sense, I'll let it go)
Give me names of your respected "industry leaders". I will counter with the same number. So, lets just agree that those leaders don't know crap and it's just you and me arguing debating the merits of this case.
Its all about facts. Numbers don't lie, although they can be twisted to fit a certain situation, when you strip them down, they are what they are.
You also keep on asking me why I care what you say? It's kind of hard to explain, but I don't really care what you say, its just that you spout off about supporting this deal, yet the best you can offer is generalities ("I know money people", "its my opinion", "thats they way I feel", etc etc....) Use some real, traceable facts that can be supported by someone actually checking out those facts. Stop with your silly suppositions that are supposed to make to make everyone think like you've been paying attention, rather than asking a few "money men" and accepting their opinion.
And really, I'm getting kind of sick of you looking for support. Everyone has stated that your children should not be brought into this. Stop bringing them into this, Stop trying to make everyone feel bad because people don't like you. Get over it.
As for your post sitting for a couple of weeks. It was put on my blog that you have a blog. Myself and others decided BY OURSELVES to come here and have our say... There isn't a mafia, teamsters connection where we are all out to get you.. Quit the conspiracy theory crap too.
Give all of us one damn FACT that supports your opinion. And don't bring your children up or cry about how people aren't nice to you.
And really, I'm getting kind of sick of you looking for support. Everyone has stated that your children should not be brought into this. Stop bringing them into this, Stop trying to make everyone feel bad because people don't like you. Get over it.
----------------
I will give you a fact. Here it is. You have found this forum. Use it as you will.
I, however, have wasted enough time with one who hides behind the name of three men dead about two hundred years.
State your real name, your job and then get hold of me.
As far as my children go, it is the people who work for the company you are seeking to protect who accosted them in public. You may find that okay, you may want to brush it off, but the only times that has happened is when I took on the school consolidation and said the teacher's union would have to wake up to reality, took on the MSEA over the fairshare issue and now the vaunted Verizon union.
My Christian side tells me to forgive. My human side tells me to tell you to go to hell and all who support such an organization.
Fortunately, my faith is stronger than my anger, so I will simply forgive the actions of SOME of your co-workers and wish you a Merry Christmas.
What fact, by the way, have I not refuted? You say they cannot financially handle this deal. I say they can because the people who deal with the people who will give them the money say they can.
Are you a financial analyst with Verizon? Are you a line worker? If so, while honorable work, it does not give you the capacity to analyze this deal ... if you are the humble worker you claim, you are only repeating what you have been told by people whose interest it is to tell you.
Face it, we are both operating off information provided to us from people we believe.
If you are a financial analyst with Verizon and have the background to unravel this deal, my email is ray@wlobradio.com
Tell me who you are, what your qualifications are to make the claims you do. If you check out, then like any other guest, I will invite you on for a debate in the beginning of January when I return to work.
If, however, you are simply a humble worker spewing what your union has told you, sorry .. I have no interest.
The financial people I have spoken with say that this deal works.
What is it you do not get about that? WHO told you it does not? Can they prove it?
DO you honest to God believe that the PUC will approve it if the numbers do not work?
You did not hit a nerve with me my friend. You said you were looking for facts. I gave you the reasons I have disdain for unions, but like everything I have written here and said on air, you discount it because it does not suit your position.
Being a humble worker at Verizon is honorable and I appreciate that you work hard and contribute to our economy. It does not, however, give you some legitmacy because your work there unless you are part of the financial team Verizon put together to see if this deal works.
I believe you will not reveal yourself. If you do and I am wrong, I believe you will be a regular guy or gal, just like me, who is simply re-stating what you have been told by people you trust.
I am not a financial analyst, never claimed to be. I do, however, have a lot of friends around the country who are experts about a host of issues. I trust their judgement.
They like this deal and so do I.
You may win. The forces that support the status quo are powerful.
By the way, I don't need to be liked. My wife likes me and so do my kids.
Anyone else who may is just a bonus.
Merry Christmas
There isn't a mafia, teamsters connection where we are all out to get you.. Quit the conspiracy theory crap too.
---------------------
I really should have read your whole post a second time. I missed this part.
Sorry pal, your crowd sickens me with their tactics. They sicken me when they force good men and women to stay away from the job that supports their family when they go on strike and then get violent with their own if that person dares to attempt to support their family.
They sicken me when they force state workers to pay a "work tax" to work for their own government.
MY OPINION is they are collectively a bunch of bullies who harm the average citizen and intimidate them into doing things they would otherwise not do.
I know that there are no facts about such acitivties that you would accept, so I will not state them ... however, if you choose to become enlightened about the bullying activities of your vaunted union brothers around the country (you all are brothers right? that is what I am told when you honor a picket line that is not your own) they are well-documented.
I have said it many times publicly. If my stations unionizes, I quit.
I would rather be hungry than be a part of such a group ..... and you know how much I like to eat.
Well, now I know what I want for Christmas.. A union at your station...
But enough of my dreams..
Listen, if you're only prerequisite to continuing this conversation is my name then I guess we're done. You know as well as I I'm not going to give it to you. I know that you're just using the whole name thing to back out of any argument that you can't win, and if you only admitted it, I would respect you more. (but hey, the only way to go with my respect for you is up)
You're wrong that I wouldn't listen to your facts. I am very reverent of facts, but we both know that you don't have any, do you?
You're complete unwillingness to talk about the sale instead of unions shows how small your mind is.
The difference between you and your compatriots at other larger FOX stations (O'reily, Hannity, colmes.. etc.)is that they have strong opinions and they state them every day, but they can actually sit down with the opposition and debate them with facts. You run from debates that you can't win without facts. You think that your opinion is important enough for people to care, but it isn't.
It's a shame that I have to teach you how to debate, but its not surprising... Come to think of it, is your station hiring?
Facts, ray, Facts!!! they will truly set you free...
You are an amazing person. I just clicked over to your website. Very nice.
Do you all sing Koom bah yah together as well? Nice support group.
Of course you are not going to tell me. You are not interested in a debate or discussion. You are interested in preaching a sermon that is un-answered, without any accountability.
I debate the other side every day on that station over taxes, healthcare, jobs and the economy. They know who I am, I know who they are and so does our audience.
You want a vehicle you have not earned. You want to be able to spew whatever passes for a thought in your mind with responsibility.
Does not pass with me, maybe it will on your forum. Interesting, several names on your forum match those here. I thought you said there was no effort to bring folks to my forum, just independent thinkers who are concerned solely about the well-being of others.
I noticed the hateful comments about Gene Johnson. You should be so proud that you produced a forum that would take such shots at a man that I am quite certain you have never met face-to-face.
Gene, by the way despite your lack of truth, did not refuse to take calls on my station. He also did not "choose" my station as a safe place.
I called him and asked him to fly up. I told him that I wanted him to explain why he wanted to do this deal. The audience knew where I stood, I thought it was important for them to know where he stood and why.
I am the one who chose not to take calls. We had 45 minutes which translates to roughly 24 minutes on air. I am the one who said no. He was more than willing.
If facts are so important, why would you create a lie that gives the appearance that Gene Johnson was hiding rather than take your "tough" questions?
Say what you want about me, I find it amusing, but I don't like it when a person lies about another and uses my station to legitimize their lie.
Gene Johnson is a good man. You cannot see that because you are so worried about your job, or your union or whatever it is that you are worried about.
JP Morgan is bad because they liked the deal. Everyone else is good because they hate the deal. Yeah, you guys on your site are consistent. Consistently void of open-mindedness and vision.
Have you emailed Kurt Adams with your concerns? He actually has a vote on this issue.
OF course, if he votes to support this, I can hardly wait to read the comments on your forum.
Kurt Adams is a man of integrity. He will decide this based on the truth as he sees it.
I will give you credit though.
One, you have made my afternoon of watching football a little more fun.
Two, you have done what I encourage everyone to do ... get involved .... good for you.
Have you yet figured out why I support this deal?
the above should have read
comment without responsibility
Thought you weren't getting involved in this conversation anymore?
Thanks for visiting my site. Do you like the colors?
Great job figuring out that some people from the site area also some that are on this site too, considering they used the same name. youre a genius I tell ya!
You're true colors are shining brightly by telling me I haven't earned the right to talk on your show... I suppose the crazy preacher that heard God talk to him every day on your show last week put in his dues...
but really enough of that Ray....Facts...where are your facts???
Why the personal attacks against guests on the show? Nobody forces you to watch or listen. There are other outlets, although it is clear to me you listen or watch because my show is the only place you cannot control with the tactics of the organization you hold dear.
Gary's story, had you actually listened instead of seeking to ridicule, was a story of his journey to the pulpit. It was his story of how he was never quite settled no matter how good the situation because, as he found out, God had another plan for him.
You would have had to listen with an open mind to have heard that and to have understood why I invited him on.
His story was not about keeping his job or protecting his union or denying opportunity. His story was about having courage in his faith, about having the courage to forego his safe and secure situation to trust in his God.
You would have had to listen to have heard his story, but I suspect listening is not something you value.
You may post as you choose here as long as you do not become nasty or make blatant, unwarranted attacks against individuals other than me.
I am finished with this discussion.
I assumed you were interested in a real discussion because of your persistence, but having re-read your comments here and taking a more in-depth look at your website, I have no interest in any further discourse with you or your compatriots.
You can say whatever you choose, call me a coward full of no facts ... but know this.
My name is here as it is on my show. I say what I think and I do not hide in the shadows.
I wish you well in influencing the PUC. Should you prevail, I pray I am wrong about my thinking regarding Verizon and your union.
Maine's future is hanging in the balance on this issue, Plum Creek, our tax burden and the cost of health insurance.
I sincerely do not wish for you to lose your job, but I do hope you and your friends lose this battle.
Merry Christmas to you and your friends.
Ray Richardson
Ray, here is a crash course for you.
What Does Verizon Selling Northern New England Landlines Mean?
Verizon’s proposed sale of its landline business in Vermont, Maine, and New Hampshire is an indicator of the turmoil to come in telecom during the next five years. Verizon is open that it needs to concentrate its assets on upgrading its access in the part of its territory which it’s keeping to FiOS (fiber). What is not clear is how FairPoint can survive and continue to provide service let alone upgrade in its new service area.
Back in January, Verizon announced a definitive agreement with FairPoint Communications on a complex deal which, when consummated, will leave FairPoint owning all of Verizon’s landline (but not wireless) business in northern New England. Verizon shareholders (but not Verizon itself) will end up owning 60% of FairPoint; FairPoint will end up with $1.7 billion of new debt; and Verizon will receive a combination of cash and debt instruments from FairPoint totaling $1.7 billion. The deal is subject to many regulatory approvals including the Public Service Boards or equivalent in the three states.
OK, who’s FairPoint? Well, currently they’re a New York Stock Exchange listed company (FRP) with a market cap of $634 million, up almost 30% since the deal was announced. They’ve made a living by buying and operating small rural telcos (which get large subsidies from access charges and the Universal Service Fund). They’re profitable; they pay a pretty high dividend.
As of September 30, 2006 FairPoint said they served 252,000 access lines. The Verizon landline network in three northern New England States includes 1.6 million access lines – but it’s shrinking! Nationwide, Verizon reported that traditional (copper) access lines declined by 7.9% from the end of the first quarter of 2006 to the end of the first quarter of 2007.
FairPoint announced “…its commitment to maintaining union jobs, working with the union in a collaborative fashion, and continuing to honor the existing collective bargaining agreements… FairPoint will assume pension and other post employment benefit obligations for all active, continuing employees of Verizon companies.” Verizon keeps the pension obligations for those who are already retired. The unions, however, are not convinced and oppose the deal.
FairPoint also says it anticipates spending $100 of capital per access line in each of the next three years to upgrade the lines in the three states (which they need) and enhance their revenue potential.
All of these good things, they say, plus servicing the debt, will be financed out of cash flow from the operations they are buying. Initially, you can make a case for this if you believe their assertion that they can realize operational savings of $60 to $75 million while maintaining the union contract.
The problem is that the cash flow from the business they bought is going to decline faster than they can generate new revenue to replace it from enhanced services and that they won’t generate the capital or borrowing capacity they need to make the upgrades needed to preserve the cash flow. After all, if Verizon thought the cash flow was going to stay positive, they could’ve stayed. But let’s ignore that and believe Verizon’s claim that it has to focus on other regions.
Here’s what’s happening using Vermont as an example:
In the most profitable part of the market, Verizon has competition from Burlington Telecom which is doing a great job of bringing fiber to residences in that city and taking market share from both Comcast and Verizon. Ironically, this is in an area where the current copper plant Verizon has could be upgraded fairly cheaply to provide good Internet access.
Other cities and towns in Vermont are lining up to make deals which would result in Burlington Telecom helping bring 50 meg fiber to the premises of their residences. BT will only make deals on the basis of 100% availability in each town. There goes more market share.
Verizon doesn’t offer cable services in Vermont; Comcast does and Comcast is getting more aggressive with its offer of Internet access, telephony, and traditional cable entertainment in the State. According to the Burlington Free Press “The …company is eager to trumpet its work so it doesn't get lost amid all the discussion of the new Vermont Telecommunications Authority lawmakers authorized this year, or the proposed sale of Verizon's landline business in northern New England to FairPoint Communications.” The article says the company is planning line extensions in 58 communities. Many of these new customers represent a loss of current telephone revenue to Verizon/Fairpoint AND a loss of a future upgrade to DSL.
In the most rural areas wireless access is proving a higher speed alternative than DSL for many - especially those who can’t get DSL at all. Those customers have a tendency to use VoIP and leave Verizon once they get broadband access.
I believe that the minimum acceptable Internet access by 2010 will 3 megabits per second in each direction. Many people will need more. By 2013 this number is likely (in my opinion) to be more like 20 megabits. VoIP, if it hasn’t completely displaced traditional phone service, will further push down voice profit margins. BTW, VoIP and cellular service will have converged on a single instrument and a single number per person.
Even by the end of this year, the shrinkage in the number of copper access lines in use will accelerate. The revenue FairPoint needs will be shrinking. DSL service Verizon does install will counteract that decline but not enough.
Assuming the merger is approved and goes through at the beginning of 2008, FairPoint will have shrinking revenues, fixed commitments to pay off its large debt, an expensive workforce with obsolete work rules which it is also very expensive to trim, and a geographically large physical plant which needs both maintenance and upgrades. Given the need for ever faster speeds, that infrastructure will keep losing customers to fiber, cable, and wireless. It’s a vicious cycle because the loss of customers makes it harder to upgrade to keep the rest.
Does that means the states should turn down the mergers? It’s not at all clear that’s an option; states have laws and contracts to follow and not the unlimited right to stop any deal that would hurt their residents. Also, Verizon hasn’t shown much inclination to invest here, either (Copper upgrade).
What is clear is that state telecommunication policy must help assure that there are viable alternatives. If FairPoint succeeds, great. If they fail because competition beat them, presumably we who live here will be well-served by that competition – so long as service is available in urban AND rural areas. Vermont’s recently passed e-state bill is a step in that direction.
Alright Ray, If you're done with me, I'm done with you.... but I'm not the only one posting... Answer everyone else, would you.
oh, and just a reminder...Facts.
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