Local phone competition put on hold

November 17, 1994|By Michael Dresser | Michael Dresser,Sun Staff Writer

The day when Maryland consumers will be able to choose between competing telephone companies for local residential service has apparently been postponed -- perhaps indefinitely.

The Montgomery County cable venture owned by the former Southwestern Bell asked the Maryland Public Service Commission to delay December hearings on its application to provide residential telephone service in competition with Bell Atlantic Corp.

SBC Media Ventures, the cable subsidiary of the recently renamed SBC Communications, told the commission that it would prefer to put its application on hold while the PSC determines the cost of connecting with the Bell Atlantic network.

That issue will not be resolved until next summer at the earliest, making it all but impossible for SBC to meet its stated goal of beginning service in the third quarter of 1995. Frank Fulton, a PSC spokesman, said that with the postponement it is unlikely that SBC could begin offering service until well into 1996.

The company's filing also raises questions about whether SBC is getting cold feet about the notion of challenging Bell Atlantic on its own turf.

One reason it gave for delay is its contention that recent rules adopted by the Federal Communications commission made it uncertain whether cable operators will have adequate incentives to expand their system capacity to handle voice and additional video communications.

The SBC filing was the first case of a regional Bell company proposing to compete with another's local service in its own territory. It would also make Montgomery one of the first places in the country where rival providers would compete for residential customers.

The move to put the application on the back burner comes at a time when reports are surfacing in the trade press that SBC is looking for a buyer for its cable systems in Montgomery County and in Arlington, Va.

Stephen Effros, president of the Cable Telecommunications Association, said reports of a possible sale made sense because the regional Bell companies had lost their enthusiasm for cable television because of the FCC's regulation of the industry under the 1992 Cable Act.

"Southwestern Bell got caught because they already bought," Mr. Effros said. "They already owned these cable systems before the hammer came down."

In its filing, SBC asked the PSC to postpone action on its application until the agency can make a decision in the second phase of MFS Intelenet's petition to offer local telephone service to Maryland businesses. In that case, which will come to a hearing before the PSC in June, the commission will decide how much Bell Atlantic's competitors will have to pay to connect with its network.

SBC said one reason it has decided to put off its hearing was that Bell Atlantic recently received an extension of an Oct. 31 deadline to file a study of the costs of such connections. That study is now expected by Dec. 15 at the earliest.

Mr. Davenport said that since it was clear that its application could not be fully resolved until the MFS case set the precedent, the company elected to defer its case.

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