Frontier Communications 2012 Annual Report Download - page 15

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Video programming. Federal, state and local governments extensively regulate the video services industry.
Our fiber optic video service is subject to, among other things, subscriber privacy regulations; requirements that
we carry a local broadcast station or obtain consent to carry a local or distant broadcast station; rules for
franchise renewals and transfers; the manner in which program packages are marketed to subscribers; and
program access requirements.
We provide video programming, on a limited basis, in Oregon, Washington and Indiana pursuant to
franchises, permits and similar authorizations issued by local franchising authorities utilizing fiber optic
delivery transport to the home. Most franchises are subject to termination proceedings in the event of a material
breach. In addition, most franchises require payment of a franchise fee as a requirement to the granting of
authority.
Many franchises establish comprehensive facilities and service requirements, as well as specific customer
service standards and monetary penalties for non-compliance. In many cases, franchises are terminable if the
franchisee fails to comply with significant provisions set forth in the franchise agreement governing system
operations. We believe that we are in compliance and meeting all standards and requirements. Franchises are
generally granted for fixed terms of at least ten years and must be periodically renewed. Local franchising
authorities may resist granting a renewal if either past performance or the prospective operating proposal is
considered inadequate.
For information regarding approvals by local franchising authorities in connection with the transactions,
see “—Regulatory Environment—Regulation of our business.”
Environmental regulation
Like all other local telephone companies, the local exchange carrier subsidiaries we operate are subject to
federal, state and local laws and regulations governing the use, storage, disposal of, and exposure to hazardous
materials, the release of pollutants into the environment and the remediation of contamination. As an owner and
former owner of property, we are subject to environmental laws that could impose liability for the entire cost of
cleanup at contaminated sites, including sites formerly owned by us, regardless of fault or the lawfulness of the
activity that resulted in contamination. We believe that our operations are in substantial compliance with
applicable environmental laws and regulations.
Segment Information
We currently operate in only one reportable segment.
Financial Information about Foreign and Domestic Operations and Export Sales
We have no foreign operations.
General
Order backlog is not a significant consideration in our business. We have no material contracts or
subcontracts that may be subject to renegotiation of profits or termination at the election of the federal
government.
Intellectual Property
We believe that we have the trademarks, trade names and intellectual property licenses that are necessary
for the operation of our business.
Employees
As of December 31, 2012, we had approximately 14,700 employees. Approximately 9,200 of our
employees are represented by unions. The number of employees covered by collective bargaining agreements
that expired in 2012, but have been extended and are still open in 2013, is approximately 2,400. The number of
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FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES