"Too rich for my blood."

How do you cushion the blow of a 46-percent rate increase for your fiber-optic television service that will cause consumers to flee?  Don’t tell them about it.

Regulators in the Pacific Northwest are beside themselves over news that their new local phone company, Frontier Communications, is going to raise rates $30 or more for its FiOS cable television service.  The company earlier promised no rate increases as a result of its purchase of landlines from Verizon.

But the only way customers in Oregon know about the impending rate hike is from The Oregonian newspaper; Frontier has yet to formally notify subscribers of the dramatic price hike.

The newspaper reports the higher rates were supposed to take effect at the beginning of the year for new customers, and Feb. 18 for current customers with expiring contracts.

But Frontier has not yet notified its customers of the rate increases.  Spokeswoman Stephanie Beasly told the paper the company was working on “specific messaging.”  Namely, how does Frontier tell customers their bills are going up $30 and still have them as customers after that.

Until the deck chairs can be re-arranged, the rate increase will not take effect.  But Beasly emphasized it eventually will.

Washington County regulators (in Oregon state) are questioning Frontier’s justification for the rate hikes, namely “increased programming costs,” noting their competitors are charging far less for the same type of service:

Bend Broadband, an Oregon system providing a similar level of programming and services as Frontier, is able to manage its costs and keep subscriber rates at or below the range of large cable operators and significantly below those that Frontier has announced.

Some regulators are wondering if they were deceived by the company’s earlier promises to deliver “competitive prices” in the region.  Metropolitan Area Communications Commission administrator Bruce Crest wrote the company suggesting they are not living up to their end of the deal:

However, Frontier’s recent decision to place a significant and unjustified rate increase on its customers, along with the incongruity of Frontier’s justification for that increase against the statements made in 2009 and 2010, makes us question whether Frontier has, or ever had, a good faith commitment to fulfill the terms of the franchise.

Frontier responded to the Commission’s inquiry by essentially telling them to bug off — they have no authority to question Frontier’s prices. Company vice-president Steven Crosby waved-off MACC’s concerns:

While Frontier recognizes that the MACC is interested in any Frontier FiOS video price increases and alternative offerings Frontier provides to its customers, Frontier respectfully notes that the MACC does not have authority to regulate the rates Frontier may charge for FiOS video service, nor does the MACC have authority to regulate Frontier’s commercial relationships with content providers. Accordingly, Frontier reserves the right to decline to respond to inquiries directed to topics that are beyond the MACC’s jurisdiction and may be competitively sensitive. Furthermore, Frontier objects to the MACC’s letter of January 20th to the extent that it contains characterizations and questions that misstate facts and conclusions or are otherwise misleading.

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MACC Letter to Frontier FiOS