Fairpoint Scare-mongering

Robert L. Mitchell of ComputerWorld seems to be lobbying hard against the sale of the Verizon wireplant in NNE to Fairpoint. His argument seems to be that Verizon won’t build out rural broadband but Fairpoint might only get us 6Mbps service, so we ought to stick with Verizon. I left this comment there:

I’m not sure I follow the logic – Verizon is committed to not providing rural broadband (and they have a fiduciary responsibility not to invest in a lower-profit market so it’d be crazy to think they would) but Fairpoint, which builds its business model around rural broadband would somehow be worse?

For example, where I live, in not-so-rural NH, there’s an SLC fed by fiber just a mile from the house but Verizon won’t install a DSLAM in it because they “don’t do that”. We’re 6 miles from the actual CO, so no DSL. No cable in this neck of the woods either, and fixed wireless isn’t an option, nor are cellular services due to coverage. I’ve talked to Peter Nixon, and he says Fairpoint does that regularly. The lines on the road are of good quality (ravaged by a storm and replaced last decade), so the investment to get us all DSL is small, but Verizon isn’t interested in the business and regulators have repeatedly shown a disinterest in changing that situation.

I remember upgrading to 26.4Kbps in 1994, and that’s as fast as the Internet goes today due to Verizon infrastructure. With Verizon as the line owner, we’re guaranteed to do no better in the next 13 years than we have in the past 13 years. 2020 and on 26.4 dial-up – and you worry that we might only get a 6Mbps link with Fairpoint? Every one of my neighbors would be happy to have that kind of problem.

He also raises the issue of debt as a strike against Fairpoint. I’m not aware of any business that has taken on a major new endeavor without leveraging debt. I would argue that hoping new ideas would all be paid for with cash isn’t an idyllic world – it’s one where the large established incumbents control everything and competition is squelched. Maybe that’s the idea.