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Maine Regulators Weigh Verizon Plan
by Michael Martinez
As Maine public utility regulators on Thursday begin deliberating the proposed sale of telephone lines owned by Verizon Communications to a smaller, North Carolina-based firm, local union groups fighting the deal are mounting last-minute resistance.
The Maine Public Utilities Commission could issue a decision on the proposed $2.7 billion deal between Verizon and FairPoint Communications as early as Thursday. Several influential union groups, including the AFL-CIO and Communications Workers of America, are lobbying vigorously against the deal. The transaction needs approval from regulators in Maine, New Hampshire and Vermont, as well as at the FCC.
Deliberations will continue later this month in Maine if regulators do not reach a decision on Thursday. State Public Advocate Richard Davies told the Portland Press Herald earlier this week that progress has been made on several key issues.
An advisory panel to the commission last month issued a report urging regulators to reject the deal. The nonbinding report said that FairPoint, which currently operates in 18 states, is carrying a significant debt and that taxpayer dollars would unnecessarily be put at risk. The panel also advised that the deal be reworked so that FairPoint is required to increase its investments in high-speed Internet infrastructure in all three states.
The AFL-CIO and the International Brotherhood of Electrical Workers, meanwhile, issued their own report last week claiming that Verizon's savings from a tax loophole in the deal could fund broadband projects all over New England. The report argued that Verizon specifically chose to sell its lines to FairPoint in order to avoid $600 million in taxes and that taxpayers would effectively be subsidizing the sale.
According to those labor groups, Verizon's tax savings would be enough to finance a special broadband infrastructure fund capable of providing fiber-to-the-home service to more than 80 percent of consumers in the affected states.
"The proposed sale of Verizon's operations to tiny FairPoint could relegate northern New England to the information dirt road," the report said.
New Hampshire Consumer Advocate Meredith Hatfield told the Press Herald that regulators in her state and Vermont are keeping a close eye on Maine. The New Hampshire Public Utility Commission may make its own decision on the deal as early as next week. FairPoint and Verizon got a boost in the Granite State earlier this month when the New Hampshire Electric Cooperative announced its support for the sale.
Schwarzenegger Separates Himself From 'Conan' Game
California Gov. Arnold Schwarzenegger once played the fictional, muscle-bound hero "Conan" in a pair of blockbuster films, but now the Republican has made clear that he has nothing to do with a new videogame based on the character.
The Contra-Costa Times this week reported that a Schwarzenegger spokesman said the governor has "no association" with a new game based on the "Conan" story. The game was among the titles recently condemned in a report compiled by the National Institute on Media and the Family.
Schwarzenegger has staked out a firm position on restricting the sales of violent games to children. But a measure he signed into law to do so was struck down in federal court as unconstitutional. He already has appealed the ruling, a move some critics claim will be a waste of taxpayer money. The videogame industry thus far is undefeated in challenging similar state laws.
State Sen. Leland Yee, the author of California's failed videogame law, told the Times that the "Conan" game is the kind of title that needs to be kept out of the hands of minors. "Conan" received a "mature" rating from the Entertainment Software Rating Board, the videogame industry's self-imposed ratings body.
Texas Launches Competitiveness Council
Texas Gov. Rick Perry this week announced the creation of a panel that he said will help identify the best path for the Lone Star State to remain competitive in the global marketplace.
Late last week, Perry, a Republican, launched his so-called "Governor's Competitiveness Council." The group will include members from both the private and public sectors. It will be chaired by Texas Secretary of State Phil Wilson.
"We live in a world that moves faster than at any time in history," Perry said. "Knowledge and capital are rapidly being deployed to parts of the world where the right combination of talent, technology, business climate, infrastructure and markets converge."
Perry also said he will apply "competitiveness standards" to his own office and pledged to propose legislation requiring the state to begin keeping a "competitiveness impact score" in the style of the fiscal impact reports currently kept by the state Legislative Budget Board.
Some of the private industry members of the competitiveness panel will include officials from AT&T, Dell, Lockheed Martin, Texas Instruments and Time Warner Cable.
Attorneys General Target Payment Processor
The attorneys general from six states, along with the FTC, combined forces this week to sue a payment processor for its alleged role in helping fraudulent telemarketers and Internet-based firms scam more than $200 million from consumers.
The top law enforcers from Illinois, Iowa, Ohio, Nevada, North Carolina, North Dakota, and Vermont have sued in federal court the processing firm Your Money Access. Their complaint alleged the company unlawfully processed more than $200 million in debits and attempted debits to consumer accounts. The suit also claimed the Internet-based clients served by the company were engaged in deceptive schemes to bait consumers into surrendering their bank account information.
"Our office is ready to take action against the parties involved in this activity, whether they are the callers or the payment processors," Ohio Attorney General Marc Dann said in a news release.
Arizona Broadband Project Considers Buyer
Municipal officials in Arizona are optimistic they have found a buyer to take over a project to provide citywide high-speed Internet access in Tempe.
IDG News reported this week that Tempe is considering handing over the project to the firm Telescape, which claims it is capable of building and managing a network in the city that can serve as many as 10,000 users. The stalled Tempe project already has gone through several private providers and is currently only serving about 500 residents.
A Telescape executive told IDG that Tempe's overall plan is sound but that the city's previous partners failed to execute it properly. Company Chairman Tad Neeley said the "real cost" of such projects is not building the network itself but rather acquiring the customers to use it.
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