Qwest deal raises specter of change

CenturyLink is acquiring Qwest for $10.6 billion, but competitors and union employees are saying they will opposing the deal in state regulatory hearings unless they get guarantees that they won't be hurt by planned cost-cutting in the Qwest operations over the next five years.

Qwest and CenturyLink are trying to head off that threat by presenting their own vision of what Minnesota's largest phone company would look like in the future. The hearings are currently in a middle phase in which testimony is being taken; regulators aren't expected to rule on whether the acquisition can take place until early next year. The two phone companies issued a list of guarantees about what they would and wouldn't change in Qwest's Minnesota operations over the next two to three years, providing the acquisition is approved by the Minnesota Public Utilities Commission. In addition, the two phone companies guaranteed a minimum investment in high-speed Internet service in Minnesota, totaling $50 million over five years. One-third of the money would be spent in areas that are unserved or underserved. The guarantees, which were negotiated privately between Qwest, CenturyLink and the Minnesota Department of Commerce, appear to be designed to mollify opponents of the acquisition. The opponents point out, however, that the $50 million guarantee is actually less than Qwest has been spending on broadband in the state.