There's some interesting discussion over at Gordon Cook's Blog (here and here) concerning Verizon's swap of their DSL & landline networks to Fairpoint Communications in Vermont, New Hampshire and Maine. Verizon is using something called a "Reverse Morris Trust" to offload $1.7 billion in debt, and at the same time gain some $600 million in tax writeoffs. Explains Tom Evslin:

"The way this [copper] plant is removed from the balance sheet is by creating a reverse Morris trust and using it to convey these underperforming assets to a small company before they lose more value and absorb more cash either for upgrade or maintenance. This neatly avoids a writedown of these assets as well. And allows capital be concentrated on fiber."

Verizon offloads rural and "unprofitable" territories they aren't interested in upgrading, while making a significant amount of cash that can be directed towards FiOS deployment. Fairpoint meanwhile acquires a slow growth (and largely rural) market and takes on a significant debt load. The company tells the Associated Press today that there's nothing to worry about.

Related: A Fairpoint executive speaks to a local New Hampshire news outlet and insists that if the deal is approved, everything (price/contract/bill) stays the same for existing Verizon customers, with the exception of bill letterhead and increased rural deployment.