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FairPoint Grilled By Regulators

Vermont is considering revoking FairPoint's license to run the landline and Internet assets it acquired from Verizon, given the volume of customer complaints.

Already struggling to stabilize management of its northern New England telecom assets, FairPoint Communications is facing a hard-nosed examination by Vermont's Public Service Board, which is threatening to revoke the firm's right to do business in the state.

In a hearing Monday, the PSB gave FairPoint, which took over landlines and Internet service from Verizon last year, until September 10 to "show cause" why its license to do business in the state shouldn't be revoked.

"If FairPoint cannot raise its service quality to an acceptable level," said PSB special counsel James Porter III, "it's our opinion that we've got to look at whether they should be operating the incumbent phone company here... It's been an enormous amount of problems for an extraordinary amount of people. And we think they've had sufficient time to get things pulled together."

From the time the asset takeover was announced in January 2007, regulators in the three states -- Maine and New Hampshire in addition to Vermont -- questioned whether FairPoint had the financial and telecom expertise to operate the former Verizon assets.

In recent days, FairPoint president Peter Nixon has told regulators that service issues and response to customer complaints are improving. Nixon told Vermont regulators that FairPoint was improving wait times on installations, customer service calls, and bill accuracy. The Vermont regulators, however, countered with reports of high numbers of customer complaints.

FairPoint has been struggling with similar problems in Maine and New Hampshire and regulators in those states have also taken FairPoint to task over the problems.

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