Why is it a turkey?
Verizon (NYSE: VZ) may have made progress with its wireless LTE network plans and wireline-based FiOS Fiber to the Premises (FTTP), but much of the emphasis of those services in larger markets came with the price of ignoring some of its smaller, rural markets like West Va.
Despite pleas from its own employees and criticism from West Virginia's Public Service Commission (PSC), Verizon apparently had ignored much of its landline network in West Virginia. The end result of this neglect was poor POTS service and low DSL broadband penetration of 60 percent in the state.
Of course, Verizon defends its record in West Virginia. Previously, Verizon said it had dedicated $11.9 million since 2008 to improve service in the state.
Still, Verizon did find an easy way out of its West Virginia network problem by selling off its rural assets in 14 states to Frontier Communications (NYSE: FTR) last year.
Of course, to get the thumbs up from regulators to proceed with its acquisition of Verizon's lines, Frontier had to commit to a number of concessions, including upgrading its aging PSTN network and expanding the state's broadband availability.
Achieving these service improvement and broadband goals in West Virginia--now one of its largest serving states--is going to cost Frontier a good amount of money.
Frontier agreed to invest $310 million to improve PSTN service and expand broadband availability. Out of that figure, Verizon itself will have to invest $72.4 million to improve PSTN service, while Frontier itself will commit $48 million to expand broadband availability throughout the state by the end of 2013.
What's slightly ironic about the West Virginia network is that now Verizon named West Virginia as one of the states to debut its wireless LTE broadband service.