Overriding objections from Bell Atlantic Corp., the Public Service Commission granted permission yesterday for AT&T Corp. to offer local telephone service to both residential and business customers in Maryland.
The decision makes AT&T the first company in the state to gain authorization to compete with Bell Atlantic for service to homes. The PSC previously had opened the business market to competition.
However, the decision does not mean customers will be able to call AT&T and get local service anytime soon. AT&T has said it could begin offering service as soon as this summer, but the company still has many regulatory hoops to jump through before it will be able to offer dial tones in Maryland.
The PSC action came on a 4-0 vote, with one abstention, after a Bell Atlantic Corp. lawyer urged the commission to hold a full evidentiary hearing on the issue of opening the residential market to competition.
The PSC said no. It approved AT&T's application on an expedited basis at its weekly administrative meeting.
"Competition in residential service, in my opinion, is in the public interest," said Commissioner Susanne Brogan.
She and the other commissioners said more hearings will be necessary to resolve many of the issues surrounding residential competition, but they accepted arguments by AT&T and the PSC staff that there was no reason to delay certification.
Hearings on the residential competition issue could have tied up AT&T's certification for months.
"All Bell Atlantic is doing is trying to delay the competition," said Robert Lopardo, an attorney for MCI Communications Corp., which supported AT&T's position.
Michel Daley, a Bell Atlantic spokesman, said the company knew the end of its residential phone monopoly was "inevitable."
"There's nobody at Bell Atlantic pounding their heads against the wall as a result this decision."
The Philadelphia-based phone company did prevail on another competition-related issue yesterday: It persuaded the commission to delay giving its approval to a consensus choice of methods for allowing customers to keep their phone numbers when they change carriers.
Same phone number
That capability, called number portability, is widely regarded as necessary for effective phone competition.
Bell Atlantic argued that the commission should not endorse an industry consortium's choice of technologies for number portability until the PSC has more information about the costs and how they would be allocated.
Commissioner Brogan, who has emerged as the PSC's most vocal advocate of a quick transition to competitive telecommunications, denounced Bell Atlantic's argument as a "smoke screen." She and Commissioner Claude Ligon dissented the 3-2 decision on the portability issue.
The PSC's decision to let AT&T compete in Maryland comes as little surprise. The commission became one of the earliest in the country to crack the local telephone monopoly in 1994 when it granted "co-carrier status" to MFS Communications Co. in the business market, after a full-scale hearing.
Since then, the PSC has speedily approved entries in the business market, while sending clear signals that its pro-competition philosophy extends to the residential market as well.
Ross Baker, AT&T's government relations director for Maryland, said the company's eventual investment in switching centers and other facilities in Maryland could eventually come to "hundreds of millions" of dollars.
However, Mr. Baker said the company intends to make its initial foray into Maryland as a "reseller" of Bell Atlantic services.
Before then, the PSC must go through a lengthy proceeding to set a wholesale rate for telephone services -- an issue the commission put on its docket as part of yesterday's decision.
Mr. Baker said the PSC's decision to grant immediate certification will speed the company's efforts to enter the Maryland residential market.
"It gives a clear signal to Bell Atlantic that AT&T is serious in its negotiations for interconnection and resale," Mr. Baker said.