One month after Frontier Communications took over phone service from Verizon Communications in West Virginia, unresolved problems over West Virginia’s telephone system continue to mount, leaving one sheriff’s department using Facebook to communicate with some residents and a renewed call for an investigation over Frontier’s poorly functioning “Operational Support System.”

One serious problem is in Wetzel County, where the local sheriff’s office faces trouble from disruptions to their call management system that began July 1st, the date Frontier switched over operations from Verizon Communications.  Calls that are intended to reach individual officers’ direct extensions or voicemail are instead being diverted into a black hole, as callers are told they will be transferred to an operator that does not exist.

The result of the ongoing, month-long problem is that individual residents are unable to reach officers except through the county’s Facebook page and website.  Emergency calls to 911 are not affected, but calls transferred from 911 to the sheriff’s office are.

Despite weeks of back and forth, Frontier is blaming an outside vendor for the problem, claiming the sheriff’s office needs to order a “part” to repair the all-digital call management system.  That doesn’t seem to impress Wetzel County Sheriff James Hoskins, who wonders why the problem suddenly started the same day Frontier switched away from Verizon’s systems.  Additionally, voicemail messages saved on Verizon’s old system are no longer accessible to the department.

Meanwhile, other service disruptions continue to pile up across the state, along with consumer and business complaints at the Consumer Advocate’s Division of the Public Service Commission.  Things have deteriorated so much, the state’s Consumer Advocate Byron Harris is asking the Commission to hold hearings on Frontier’s poor performance in the state.

Harris told MetroNews the problems have gone beyond glitches.

“In any transition between companies, there are always going to be some glitches, but this has gotten past the point of glitches,” Harris said.

FiberNet uses Frontier’s landline network and, last week, that company asked for a similar review.  FiberNet officials say their customers have been experiencing many problems since the change at the beginning of the month.

“At the Consumer Advocate’s Division, we’ve also noticed a significant increase in complaints, across the board, all types of complaints from customers,” he said.

Harris says customers that are having problems are, in some cases, also finding it difficult to get in touch with anyone with Frontier to report their issues.

But Frontier Spokesperson Brigid Smith says it’s impossible to completely avoid all such problems.

“We are 30 days into a very, very large change which, by and large, has gone very well,” Smith told MetroNews.

“There have been glitches.  We have taken accountability for those.  We are trying to fix a system that has been sorely neglected and we are very, very committed to the state.”

Stop the Cap! reader Janel from Huntington thinks that excuse is becoming the equivalent of a broken record.

“Frontier can’t help but tell people here over and over and over how great of a job they’re doing and how well the transition went,” she writes.  “But there are a whole lot of people who disagree — they just don’t happen to work for Frontier.”

Janel’s cousin lost his DSL service for nearly a week after the transition and after repeated calls to customer service finally learned the company lost his records.

“They deactivated his account and their customer service people, when they bothered to answer, were about as useful as a car in a ditch,” she notes. “They had no record he even had an account and thought he was served by some other company, despite having a phone bill he was willing to fax them showing he had their DSL service.”

Frontier eventually “re-established service” after re-entering his customer information and reauthorized the DSL modem.

Frontier’s unionized employees facing enormous overtime demands are perhaps the best evidence Frontier continues to experience serious transition issues.

Frontier used a provision in its union contract with the Communications Workers of America to demand 70-hour workweeks for many Frontier service technicians working in West Virginia, declaring an “emergency and long term service difficulty.”

With an extremely hot summer underway, line technicians are facing long hours in 90 degree plus weather repairing lines Verizon neglected for years.  Transition issues are also being blamed for long overtime hours as Frontier works its way through a large number of unresolved support requests.

[flv]http://www.phillipdampier.com/video/WTRF Wheeling Major Concerns With Phone Line at Wetzel County Sheriff’s Office 7-31-10.flv[/flv]

WTRF-TV in Wheeling, W.V., reports on the concerns of the Wetzel County Sheriff’s Office, which is still without properly working phone service a month after Frontier Communications took over phone service in the state.  (3 minutes)

In the financially difficult world of landline service, there has been one bright spot for Verizon — its state-of-the-art fiber optic service FiOS.  The cost of replacing obsolete copper phone with 21st century fiber optics has proved to be an expensive, but successful endeavor, at least in the eyes of customers.  Hated by Wall Street for its costs but loved by those who enjoy the service, FiOS has successfully proven traditional phone companies can earn money by providing the kinds of services consumers want, just so long as investors are willing to hang in there while the investment pays off over time.  But many investors aren’t.

Some of Verizon’s critics in the investment community complain the company is n0t earning enough from FiOS — in fact, for some critics who didn’t want Verizon spending money on a fiber-to-the-home network in the first place, financial returns provide the evidence used to claim they were right all along.

Despite the naysayers, revenue for Verizon FiOS is up by almost one-third each year, with average revenue per user now reaching $145 a month.  That’s well above the money Verizon earns on its legacy copper network phone customers keep leaving, especially outside of major cities where DSL service is spotty.  There is plenty of room for Verizon FiOS to grow in the limited communities it reaches.  Unfortunately, Verizon has stopped expanding its FiOS network to new communities, in part from pressure from investors who want to see cost cutting from the telecommunications giant.

Despite the positive reviews (subscription required) FiOS earns from consumer publications like Consumer Reports, Verizon slashed marketing and promotion expenses, resulting in second-quarter net additions for FiOS TV coming in at 174,000, compared with 300,000 a year earlier.

With Verizon now deploying service to communities on a reduced schedule, the results have been underwhelming according to the Wall Street Journal:

Verizon Communications may want to tweak the ad slogan for its TV and ultrafast Internet service to “This is FIOS. This is pretty small.”

Not catchy, but it would be more accurate than the current “This is Big” line.

[…]It eventually became clear that Verizon had slowed the time frame of the buildup, originally scheduled to be mostly done this year. Instead, it now expects to meet its target of passing 18 million homes with the network by 2012.

The slower timetable allows Verizon to trim capital spending this year. The problem is that FiOS’s expansion could stall with a less aggressive approach to growth. Already, Verizon has retreated from its target of adding one million subscribers a year, in favor of boosting penetration to 40% of homes passed. At June 30, its 3.2 million TV subscribers was about 20% of homes passed.

[…]And that can only reinforce questions about long-term returns on the $23 billion FIOS investment.

Evidence that Verizon is looking for more customers in its existing FiOS markets can be found in the news the company dropped its contract commitment for new customers.  The term contracts may have held some potential customers back out of fear of a lengthy term commitment with a $360 early cancellation fee.

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Verizon FiOS goes contract free ad.flv[/flv]

Verizon started running this ad several weeks ago touting its new “no contract” FiOS service.  (15 seconds)

But a change in strategy isn’t enough for investors who demand immediate results through further cost cutting measures.

In Verizon’s second quarter earnings reports, company executives speak to this perception, proudly noting they have slashed costs through job-cutting and reduced spending on infrastructure and services.  Some of those services include DSL expansion for rural Verizon customers, many who are now left on hold waiting for broadband from Verizon indefinitely.

In many states, Verizon’s DSL expansion was incremental at best, with the company issuing press releases touting new service for literally hundreds of potential customers.

Verizon’s traditional landline business continues to lose customers year after year, and is abandoning millions of others through sell-off deals with companies like Frontier Communications.  Light Reading notes Verizon eliminated 11,000 jobs in its Mid-Atlantic and Eastern regions through early retirement incentive programs, an idea soon to spread to other regions, particularly California and Texas in the coming months.  This kind of cost cutting saves cash and allows companies to report positive financial results in quarterly reports.

According to John Killian, executive vice president and CFO of Verizon, the job cuts are just getting started.  As Verizon further alienates its non-FiOS landline customers who can find better service and lower prices elsewhere, the company expects “further force reductions” in the coming months.  Verizon is also slashing costs by selling off real estate, consolidating operations and vacating buildings.

The impact can become a vicious circle of deteriorating service, customer defections, and additional cost cutting, which starts the circle all over again.  In West Virginia, deteriorating Verizon phone lines reached the point of serious service outages whenever major storms hit the state.  Then Verizon simply sold off its network in West Virginia.  Those customers are now served by Frontier Communications.

Verizon previously declared the era of the landline dead, and is now seeking to prove its point, even as it demonstrates it can make money by spending money on FiOS, if only investors would give them the chance.

[flv width=”576″ height=”344″]http://www.phillipdampier.com/video/CNN Behind the scenes at Verizon Fios 3-15-10.flv[/flv]

CNN took a behind the scenes tour of Verizon’s FiOS network in New York City, from the central offices to individual apartments.  (4 minutes)

Frontier Communications rented a conference room at the Charleston Embassy Suites, calling it a "command center" for the transition. (Courtesy: Charleston Gazette/Lawrence Pierce)

No state faces a larger impact from Verizon’s exit than West Virginia.  The epitome of the kind of market Verizon doesn’t want to serve any longer, West Virginia suffered through several years of Verizon not keeping up with required investments in the aging landline network, and service had markedly deteriorated as a result.  West Virginia is mountainous — expensive to maintain infrastructure, often rural — reducing potential revenues, and economically-challenged — killing the chances of making “triple-play” sales (and profits) in communities where customers have to watch every penny.

West Virginia was also the epicenter of the loudest controversy over the sale, as unions and consumer groups opposed the transaction because of its enormous threat to an entire state’s landline network.  A failure by Frontier would result in the kind of drama experienced by northern New England customers of FairPoint Communications, who suffered with more than a year of horrible service and inaccurate billing.

So news that Frontier has run into problems in the state just one week in, despite sending 250 extra employees into the area for the conversion, has raised concerns with the Public Service Commission, as well as those impacted by problems and outages.  Frontier has tried to put its best face forward, with employees holed up in a self-described “command center” in a conference room at the local Embassy Suites in Charleston.  On the day before the handover, press photographers were able to snap pictures of Frontier employees seated at long conference tables facing one another, with laptops open.  A digital projector showed PowerPoint slides that promoted the “new Frontier” while a temporary company banner tacked to a corner wall rippled over a stand.  A high tech glitz and glamor presentation this was not.

David Armentrout, president and chief operating officer of FiberNet was underwhelmed by all of it.  His company requires connections with West Virginia’s landline provider to deliver full service to his clients.  Prior to the handover, Armentrout said FiberNet had 43 outstanding trouble tickets on file with Verizon.  But Verizon apparently never handed over those support tickets to Frontier, effectively losing them after the transition.  Now that Frontier has taken over, Armentrout’s company has had to open 113 trouble tickets for problems old and new.

Armentrout complained about the lack of results from Frontier in the pages of the Charleston Daily Mail:

Armentrout said that after consistently being put on hold for more than an hour when trying to reach Frontier to talk about outstanding trouble tickets, “we had a meeting with their senior team on Saturday. We said this was not acceptable. Since then they’ve given us a work-around with two dedicated Frontier employees. When we get an hour hold time, we contact these dedicated employees.

“Another issue we’ve had is, we’ve had to contact our customers directly to verify the status of their trouble tickets because the (Frontier) system doesn’t tell us the status,” he said. “As a result of having to contact our customers directly and working with Frontier on all of these issues since July 1, our dedicated team has spent over 200 man-hours working on these issues.

“When you look at the results: six of 43 completed and three of 113 completed, we’re doing a lot of work and spending a lot of man hours but not really seeing a lot of service issues being resolved.

“Unfortunately on Friday the Public Service Commission was closed,” Armentrout said. “We made attempts to get in touch with them because we recognized we would have the problems we’re continuing to have today. I want our customers to know we’re doing everything we can to get these issues resolved.

“Several individuals within Frontier have exhibited good-faith efforts to resolve these issues,” he said. “We commend them for their efforts. But what we’re looking for is results. We need to get these issues fixed. They’ve made efforts but at the end of the day we’re still not getting where we need to be.

“Come Tuesday when business gets back to normal we can expect these numbers to increase unless we get these issues resolved,” Armentrout said. “Our intention is to go to the Public Service Commission on Tuesday and get them involved to make sure these issues are getting resolved as quickly as possible. It has been a long weekend.”

Ken Arndt, president of Frontier’s Southeast Region, issued a statement Sunday that unconvincingly blamed some of the delayed fixes on the recent death of West Virginia Senator Robert Byrd:

“We are doing the necessary work needed to correct old and current issues. It’s Day 4 and overall this has been a very successful conversion. That is especially true when you remember that Day 2 was marked by the presence of the President and Vice President of the United States and many members of Congress at the memorial for Sen. Robert Byrd. We made sure Frontier’s system performed flawlessly.”

The newspaper notes Verizon’s landline network in the state is notorious for having problems when there are storms, and since the July 1st transition there have not been any.  Armentrout agrees, hoping that Frontier’s outstanding issues get resolved before the first major storm hits the state, which could come as early as Friday.  Armentrout calls the first severe weather challenge Frontier faces “the mid-term exam.”

Taking the longer view, Frontier promises it will spend millions in West Virginia to update the state’s landline infrastructure and expand broadband availability.  Frontier announced the hiring of nine regional managers to oversee operations across the state, including Mitch Carmichael, a delegate in the West Virginian legislature representing Jackson.  Carmichael is a former computer salesman who will now manage Frontier’s Parkersburg office.

Customers are less impressed.  Many have experienced lengthy outages with their DSL service since the transition — a bad omen for many Charleston residents who immediately called Suddenlink, the area’s cable company, to switch service providers.  Another Charleston customer called Frontier’s continued reliance on a Yahoo!-provided “front end” “really low class.”  In nearby Huntington, a few customers couldn’t say much about what changed after Frontier took over because their phone service went out on the 1st and was still out a week later.

“I hope they don’t raise the bill since we have not had any phone service at all since 11:00am on July 1st when Frontier took over,” wrote one customer. “With my phone service out since Saturday and a new promise of repairs to be made by Tuesday July 6th, I am waiting to see where Frontier improves service in rural West Virginia. The Verizon employees would just as soon as to tell you anything — same people, just a different company. Frontier needs to have a major house cleaning, as their tales haven’t changed along with the service,” writes another.

A handful also complained that their Frontier phone service cost plenty more than what Verizon charged:

“My parents have Frontier and their bill is twice as high as my Verizon. We have the DSL and the freedom package (unlimited long distance, call waiting, voicemail and caller ID) and my bill is $78 a month.  My parents only have local calling, call waiting, voicemail, caller ID, and DSL and their bill is over $120 with no long distance,” he writes.  “How is this take over going to help anyone other than Frontier? I’m going to cable for Internet and phone.”

[flv]http://www.phillipdampier.com/video/WSAZ Charleston Frontier Carriers Experience Minor Problems 7-6-10.flv[/flv]

WSAZ-TV in Charleston says some companies are experiencing minor problems in the West Virginian conversion from Verizon to Frontier.  (2 minutes)

Talk about bad timing.  Just as the transition between Verizon and Frontier Communications was about to get underway, a fiber cable cut in Virginia June 29th caused a multi-state outage for Frontier DSL’s service.  In downstate New York, tens of thousands of customers lost service.

News of the outage was picked up by the Times Herald-Record, which reported nearly 30,000 customers in Orange and Rockland counties without service from 2-11am.  A Times reader named Steve observed, “I thought this outage was just the typical monthly DSL outage I suffer every month with Frontier. Think service is bad now? God help us when they get their hands on that chunk of Verizon territory. I suspect it will be overwhelming for them, from financial and technical viewpoints.”

Several thousand customers near Rhinebeck and Hopewell Junction were also impacted, according to a story in the Poughkeepsie Journal.  Reader MarienneV noted this wasn’t the first Frontier DSL outage she’s dealt with:

We noticed that there was no Internet at my house at around 5am yesterday. It was after 8pm when we were finally able to get online. This is not the first time it happened either, about a week or two ago Frontier had an outage that lasted at least five hours. Since there is no local television news up here, I felt kind of cut off from the world. I hope the Internet stays on now.

A similar service outage hit Frontier customers in the Middletown area, according to the Mid-Hudson News.

Since the transition, now even former Verizon customers are being exposed to Frontier DSL outages, especially in West Virginia where widespread problems are attracting the attention of the state Public Service Commission.

The Charleston Daily Mail today reports more than 500 customers in Martinsburg alone seem to have had problems with Internet service since Saturday:

The commission, in its May 13 order approving Frontier’s acquisition of Verizon’s landline network, required Frontier to spend millions of dollars to increase broadband deployment and subscriptions in what was Verizon’s service territory. However, the commission does not regulate Internet service.

On Tuesday Doug Stone said he and his brother-in-law, who both live outside of Martinsburg, hadn’t had Internet service since Saturday morning. Stone said a Frontier customer service representative in Texas told him the company had over 500 calls from the Martinsburg area about Internet service.

Tuesday evening Frontier spokeswoman Brigid Smith said, “The outage in Martinsburg seems to be the direct result of faulty workmanship by Verizon two weeks prior to the completion of the acquisition,” and was directly related to Verizon’s movement of a switch from Maryland to West Virginia. She added, “The cooling equipment Verizon installed was insufficient for the additional data equipment associated with this project.

“My partners at Frontier are working incredible hours to make right many things that have been too long ignored,” Smith said.

A Marmet resident who asked to not be identified said Wednesday that she and a friend, who also lives in Marmet, were without Internet service. “They tell us it will be 24 to 48 hours before they fix it,” she said. “I want you to know the problems aren’t just in Martinsburg.”

Week one of the transition for millions of ex-Verizon landline customers didn’t exactly go off without a hitch.  A few problems with support issues for certain business customers in West Virginia, a major multi-state DSL outage from a fiber cable cut in Virginia, and long hold times of 30 minutes or longer have afflicted the all-new, super-sized Frontier.  Also not inspiring confidence: a plummeting Frontier stock price as Verizon shareholders, which now own 68 percent of Frontier Communications are hurrying to dump their stock and get out.  It has gotten so bad, TradersHuddle declared Frontier Communications the worst performing stock on the S&P 500.

Not much of this comes as a surprise, particularly the fleeing of Verizon shareholders who received 0.24 shares of Frontier, worth about $1.75 on July 1st (but now dropping fast), for every Verizon share they owned on June 7.  They’ve learned from prior experience that holding onto spun-off stock from similar deals with companies like FairPoint Communications and Hawaiian Telcom ended in financial disaster — bankruptcy.  As we predicted last Halloween in our true-to-life telecom horror story, once this deal was completed, Verizon shareholders would rush for the exits, selling their Frontier stock even as the share price plummets.

Shanthi Venkataraman, a reporter for The Street, noted the selloff in progress after the 4th of July holidays.  On Tuesday the stock was down 4.5% to $7.02. More than 30 million shares have changed hands, five times its average trading volume of 6.3 million.  Analysts believe the “turbulence” in Frontier stock is likely to continue for another week as new shareholders from Verizon complete their sell-off.

Zack’s Analyst Blog notes shareholders should be concerned with the future of Frontier’s business model — focusing on a decaying landline business.  Frontier’s revenue is particularly in peril in their biggest service area, Rochester, N.Y., which represents 25 percent of the company’s total access lines.  Customers in the Flower City continue to dump Frontier’s phone and broadband services, preferring Time Warner Cable’s less expensive “digital phone” and far faster Road Runner Internet service.  Time Warner Cable has consistently reported much of their growth in new customers has come from departing landline and DSL broadband customers disconnecting service.

While shareholders have the power to cut ties with Frontier, rural telephone customers in 14 states now confronted with a shotgun wedding to Frontier are not so lucky.  For millions of rural customers, there is no other choice for telephone and broadband service.

Stop the Cap! has reviewed dozens of local news accounts regarding the transition Verizon customers are now confronting as they are introduced to Frontier Communications.  Overall, most of the rural communities are taking a “wait and see” approach, hoping Frontier’s near-universal promises of better broadband and improved customer service will come true.  Verizon effectively slashed spending at least a year or two ago in many of these communities knowing in advance they were not going to be around for much longer.  In states like West Virginia, the results have been devastating for broadband penetration statistics.  While Verizon prepared for a sale, it kept nearly the entire state waiting for better broadband that would never come from the telecom giant.  Now with news Frontier plans to spend millions to improve broadband in the state, residents are hoping that will actually bring a broadband breakthrough in West Virginia.  Time will tell.

Many communities who have long felt ignored as “too small to matter” in Verizon’s larger plans also hope Frontier will manage better customer relationships with residents. After all, Frontier is promoting itself as the phone company with the small-town feel.  But after week one, some customers are feeling Frontier is giving them the big city runaround.  We’ll explore that, and the reactions from community leaders, consumers and businesses to the promises Frontier is making in our multi-part series exploring their transition to Frontier.