Frontier Fires State Senate Leader (Who Also Worked For Frontier) For Supporting Attempts To Improve Broadband Competition

from the fighting-broadband-competition-at-any-cost dept

If you want to see what the US broadband sector really looks like, you should take a look at West Virginia -- a state where regional incumbent Frontier Communications holds so much sway over the state legislature, efforts to improve connectivity in the state have spent a decade in the gutter. Local Charleston Gazette reporter Eric Eyre has quietly done an amazing job the last few years chronicling West Virginia's immense broadband dysfunction, from the State's use of broadband stimulus subsidies on unused, overpowered routers and overpaid, redundant consultants, to state leaders' attempts to bury reports highlighting how a cozy relationship with companies like Frontier, Verizon and Cisco has led to what can only be explained as systemic, statewide fraud on the taxpayer dime.

But things haven't been going all that well for Frontier lately. Frustrated customers are leaving in droves (assuming they have the option) after the company bungled an acquisition of Verizon's unwanted DSL customers in Florida, Texas and California. It's also now saddled with debt from that deal, which prioritized growing bigger over commen sense. And employees say morale at the company is at an "all time low" after executives slashed all bonuses and merit pay increases -- but only for lower-level employees.

There's some indication that these problems are loosening the telco's traditionally iron grip on the West Virginia legislature. House Bill 3093, recently signed into law by West Virginia Governor Jim Justice, aims to improve broadband competition in the state through a combination of utility pole reform, and efforts to encourage local broadband community co-ops. Since it would have boosted competition in the state, Frontier obviously lobbied against the measure, hoping to keep its geographical fiefdom intact. It failed.

Eyre at the Gazette now notes that Frontier has responded by firing a six-year company executive and West Virginia Senate President (yes, at the same time) Mitch Carmichael for voting in favor of the measure.

So you should get a sense of what things are like in West Virginia just by the fact that Carmichael was deciding major state telecom issues while being a full-time employee of Frontier Communications. And Carmichael had been deciding on telecom-related issues for years with nobody apparently thinking that his recusal from some of these issues might just be a good idea.

This is so crazy that we should repeat it just so it sinks in: Carmichael was both a full-time employee of Frontier while also being the President of the state Senate, and constantly pushing for policies that favored his employer. And few, if any, state leaders apparently thought this was a problem. And it has been: Carmichael has long been an opponent of community run, municipal broadband, and had also recently voted down an effort that would have created a statewide broadband internet network, one that would have dramatically impacted Frontier's business interests.

Carmichael had just gotten a raise as well after almost being lured away by a Frontier competitor, so the firing surprised him. Carmichael says he also refused to sign an NDA demanded of him by the company to prevent him talking about his termination:

"Frontier Communications has laid off West Virginia Senate President Mitch Carmichael, a six-year Frontier executive who noted Monday that his dismissal follows his refusal to torpedo a broadband internet expansion bill that the company vigorously opposed...Carmichael said Frontier has asked him to sign a “nondisclosure” agreement that would prohibit him from talking about his dismissal. He said he refused to sign it. As senate president, Carmichael was Frontier’s most powerful ally in the Legislature.

Apparently, public annoyance at Frontier and the sorry state of broadband in the state (West Virginia is not-coincidentally ranked 45th in broadband connectivity) forced Carmichael to actually do the right thing:

"The one thing I’m not going to do here as Senate president is advance special interests,” Carmichael said. “It was obvious the body [Legislature] wanted that bill, and I wasn’t going to stand in the way of it."..."This was not something I wanted at all,” he said. “They had a bad year, from a legislative perspective. They severed ties from me."

To be clear, Carmichael had been willing to "advance special interests" previously, but Frontier's financial footing is so shaky -- and public annoyance at a lack of broadband competition was so severe -- he was forced to actually listen to what the public wanted. Now, courtesy of Frontier's waning influence, new West Virginia law allows 20 families or businesses to form nonprofit co-ops in areas shunned by traditional ISPs. The bill also authorizes up to three cities or counties to band together and build broadband networks in areas incumbents like Frontier have long refused to.

Meanwhile there are growing indications that Frontier, a company that has made a career out of trying to prevent real broadband competition in its territories at any cost, may at some point be looking at bankruptcy sometime in the next few years.

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Filed Under: broadband, competition, conflict of interest, mitch carmichael, west virginia
Companies: frontier

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  1. This comment has been flagged by the community. Click here to show it
    Anonymous Coward, 8 Jun 2017 @ 7:18am

    Here I am again. This is why I keep saying that pro-regulation stance between government and economy will only work against you.

    Here is more proof that Free-Market principles need a lot of air. We only need anti-monopoly and anti-trust regulations, which we actually do have, but they do not enforce them because not enforcing them gets you folks to support MORE regulation, which means more money for those coffers in the form of "campaign" donations, assorted kickbacks, deals, jobs for family members, and general power and legacy building.

    You all have feet with huge holes in them from where you keep shooting yourselves!

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