Madison River Communications

Madison River Communications. It was a competitive local exchange carrier (CLEC) founded in 1999 that provided telephone and Internet services primarily to residential and small business customers in rural areas of the United States. The company grew through acquisitions but became widely known for a landmark 2005 Federal Communications Commission enforcement action concerning network neutrality. Madison River Communications was later acquired by and merged into EarthLink in 2006, ceasing operations as an independent entity.

History

The company was founded in 1999 by telecommunications veteran Robert G. Taylor, previously an executive with AT&T Corporation. Its initial strategy focused on acquiring and consolidating smaller, often rural, independent telephone companies and CLECs. Significant early acquisitions included the purchase of Gulf Coast Telephone Company in 2000 and several properties from Cavalier Telephone. By 2004, it served over 120,000 access lines across more than 150 rural exchanges in states including North Carolina, Alabama, Georgia, Illinois, and Michigan. The company filed for an IPO in 2004 but later withdrew it, opting for private financing from firms like Madison Dearborn Partners and TA Associates.

Services

As a facilities-based carrier, it owned and operated its own central office switches and copper wire networks. Its core offerings were Plain old telephone service (POTS) and DSL-based Broadband Internet access. It also provided wholesale access to its network for other carriers and resellers. The company marketed bundled packages of voice and data, targeting customers in markets often underserved by larger incumbent carriers like Verizon and BellSouth.

Corporate structure

The firm was headquartered in Mebane, North Carolina. Robert G. Taylor served as its Chairman and Chief Executive Officer throughout its existence. Major financial backing came from private equity firms, notably Madison Dearborn Partners of Chicago, which held a controlling interest. Its operations were organized into regional divisions corresponding to its acquired properties. In March 2006, the company agreed to be acquired by EarthLink, a national Internet service provider, for approximately $211 million. The acquisition was completed in July 2006, with EarthLink integrating the assets and customers.

Regulatory issues

In 2005, the Federal Communications Commission (FCC) under Chairman Michael K. Powell investigated the company following complaints that it was blocking Voice over IP (VoIP) traffic from the service Vonage on its network. The FCC's Enforcement Bureau alleged this practice violated the Communications Act of 1934 principles on consumer access to lawful content. In a consent decree, the company agreed to pay a $15,000 fine and cease blocking ports used by VoIP applications. This early enforcement action is frequently cited as a foundational case in the ongoing network neutrality policy debates in the United States.

See also

* Competitive local exchange carrier * Network neutrality * Federal Communications Commission * EarthLink * Vonage

Category:Telecommunications companies of the United States Category:Companies based in North Carolina Category:Companies established in 1999 Category:Companies disestablished in 2006