The issues stemming from the April takeover of Verizon services in the area by Frontier Communications was the focus of a nearly two-hour long informational hearing by the State Assembly’s Committee on Utilities and Commerce today. Members of the committee grilled representatives from Frontier and the California Public Utilities Commission on what went wrong, how it happened and when customers could expect their services to return to normal.
Committee Chair Mike Gatto was joined by a handful of assembly members including Long Beach representative Patrick O’Donnell, who doesn’t serve on the committee but was compelled to join the proceedings because of the impact the transition has had in his district.
Gatto led a chorus of questions directed at Frontier’s President of the Western Region Melinda White about the thousands of complaints their offices have received since Frontier’s takeover, asking for specifics about the technicalities that led to service disruptions and demanding a hard deadline of when reliable service would be restored.
“How did this happen, why did this happen, when will this be fixed and what can we do to prevent this from happening again?” Gatto asked.
The answers that Gatto and his colleagues received did little to assuage concerns that the phone calls to their offices would wind down and revealed that some of the issues should have been anticipated given prior complaints about Verizon's network and allegations that their network was not properly cared for before being sold to Frontier.
White said that as a telecommunications company, it’s normal for a backlog of work orders to exist, but promised the committee on several occasions that the issues would be resolved in the next 10 days when Frontier would be operating at a normal level of backlogged issues.
She added that while the original list of customers the company claims experienced service interruptions reached as high as 16,000—a number which would represent less than one percent of the the 3.7 million accounts it assumed April 1—it has since been whittled down to about just over 200. White also claimed that at its peak, only 1,500 people in Long Beach experienced issues with their services.
“I’ve got to challenge you on that,” O’Donnell interrupted. “When it’s my mother, my neighbor, my own home and then I show up at a community meeting and there’s probably 300 people that came through that day I’m sure it’s many more than the number you’ve quoted.”
California was part of a three state purchase by Frontier from Verizon which included California, Texas and Florida. The $10 billion deal gave Frontier control over 3.7 million individual phone, internet and television accounts. White said the transition has experienced some problems due to a variety of factors including existing infrastructure and issues with the software. White characterized this as the largest flash-crossover in the history of telecommunications.
She estimated that of the 440 million data extracts—a term for endpoints such as a phone number, router number, etc.—absorbed by the company nearly half were corrupted, meaning that when Frontier took over their equipment couldn’t coordinate with the hardware that customers had left over from Verizon. White added that the SKU numbers on manifests received from Verizon did not match the actual numbers inside homes.
The long wait times, failure to offer or honor service appointments and the use of overseas call centers is projected to be over shortly. White said that the company has added over 5,300 call center reps, some based in the US and others offshore, but expects that its all-domestic workforce will be restored within the next few months.
“We knew that because of the size of this conversion that we wanted to make sure that we had plenty of resources,” White said. “We decided to use the same offshore center that Verizon has used for many years thinking, obviously, they already know the product, they’ve probably taken calls from California, Florida, Texas customers and that would be the best path. Unfortunately, much to our dismay, it didn’t work out.”
Members of public, like those at community meetings in Long Beach, shared their grievances regarding the Frontier takeover. Some said they spent hours on hold or talking to customer service representatives while trying to get service, which they’d been without for days, restored. One man mentioned that after several calls no offer was made to send a technician out with the only explanation being “we’re having services issues in your area.”
However, a small contingent of residents supporting Frontier was also present, with some pointing the finger at shortcomings present before Verizon left the state.
Rex Bohn, a supervisor for Humboldt County applauded Frontier for stepping up to expand the bandwidth in schools in his county so they could carry out their common core lesson plans. Bohn said that he’d received hundreds of calls about Verizon’s service even if the committee hadn’t received similar calls in the past, noting that his constituents are happy that Frontier was moving in and taking over.
“At least they’re listening, I think that’s all we can ask for,” Bohn said.
Susan Walters, Senior Vice President of the California Emerging Technology Fund, said that Verizon had not maintained its lines prior to the sale to Frontier. Walters said that the CPUC knew of numerous complaints about Verizon’s infrastructure prior to the sale and that a pattern was exhibited by Verizon of not maintaining the network.
Gatto dismissed the idea that Verizon passed on a faulty network, stating that the size of the problems points to something else at play otherwise the number of complaints wouldn’t have shot up as dramatically as they did after the April 1 swap.
“The volume of complaints that we have gotten in the last month are by a factor of a thousand bigger than what we had previously,” Gatto said. “To say this was all a pre-existing corroded network I think I take an issue with and my colleagues would as well. We did not hear those complaints before. I’ve been in office for six years, I’m starting my seventh year. I have not gotten one complaint on those issues but I’ve gotten thousands on this.”
The hearing took a surprising turn when California Public Utilities Commission Executive Director Tim Sullivan took questions from the committee. Sullivan revealed that a formal investigation proceeding by the CPUC would take about 12 months to complete, but even more, that it lacks the ability to govern digital services like the ones being discussed by the committee.
“Eighty-five percent of these complaints appear to deal with digital services,” Sullivan said. “As I’m sure you know the commission has very little authority over telecommunications services. It virtually has no authority over internet and has very limited authority over the video services.”
Sullivan said that the CPUC should’ve used more foresight in its approval of the takeover by Frontier, noting that the problems happening in this state may have been avoided if concerns about Frontier service in other states had been explored more throughly. He said that the CPUC had previously received about 100 complaints about Frontier and Verizon in a given month, since the sale that number has skyrocketed to over 860 in the month and a half since the sale.
“We’re basically talking about a five to tenfold increase in the number of complaints,” Sullivan said.
It's expected that the CPUC will take the complaint data compiled and hand it over to its investigative unit before deciding how to proceed against Frontier. An investigation could be opened by the CPUC commissioner, or the sale of the accounts could have its case reopened in light of the new data. A report will be made public after the CPUC decides which route to take.
Gatto expressed his disappointment with both the CPUC and Frontier for not learning from its past mistakes and placing the consumers in California in the position that many have found themselves in.
“I’m disappointed with the idea that we live in a world where there have been several of these that have already occurred in the state, but more importantly, there have been several of these with these precise companies and these precise mergers in other states and it sounds to me that our regulatory agency did not learn from those mistakes made in other states and that to me is very unfortunate,” Gatto said. “The regulatory system has let down the customer here in California.”