Let's level the playing field

February 04, 1999|By Sherry F. Bellamy

MARYLANDERS want to know when they will see competition among local phone service providers. The truth is that large business customers already have several alternatives to Bell Atlantic Corp.'s local phone service.

If you are a major bank, hospital or university, one of the "big three" long-distance giants -- AT&T, MCI-Worldcom and Sprint -- will gladly provide you local and long-distance service. Other competitors, such as Teligent, Winstar and e.spire, also would like to serve you.

But none of these companies has any real interest in serving residential consumers because such business is not as profitable.

Few choices

If you are a small business or a residential customer, you have few alternatives: Starpower (a joint venture of the power company Pepco and the telecom company RCN), Jones Cable, Comcast and Conectiv (a division of Delmarva Power). But these companies' services do not cover all of Maryland.

The big three long-distance telephone companies are sitting on the sidelines when it comes to local residential competition. Under federal law, Bell Atlantic is barred from entering the long-distance telephone market until the Federal Communications Commission says our local market is open to competition.

The big three are blocking such competition by refusing to offer local service in Maryland, thus keeping Bell Atlantic from competing for long-distance customers.

Lock on the market

These three companies still control 80 percent of the long-distance telephone service market, including several heavily advertised "1010" dialing services. As an example of its control, AT&T recently adopted a minimum $3 monthly charge for residential customers -- even if they make no long-distance calls that month.

The Maryland Public Service Commission has gone to great lengths to entice the big three to offer local service in Maryland.

The commission has ordered Bell Atlantic to let other companies use its $5.5 billion Maryland network at deeply discounted rates, giving the big three and other companies a 20-percent discount.

A wish list

In an effort to give the big three every item on their wish list, the PSC ordered Bell Atlantic to let AT&T and others use its facilities to serve the local Maryland market. Since this order violates federal law and provides no incentive for continued investment in the Maryland telephone network, Bell Atlantic is challenging it in court.

While the PSC has taken every step it can to encourage local phone competition, the big three still refuse to provide such service on a large scale.

Instead, they have spent hundreds of thousands of dollars on misleading media campaigns, unending legal challenges and lobbying efforts in an all-out attempt to block Bell Atlantic and other Bell companies from breaking the long-distance logjam.

Bell Atlantic has agreements to connect with more than 40 companies authorized by the PSC to offer local service in Maryland. Bell Atlantic has spent more than $1 billion in its 14-state region and devoted several hundred employees solely to making the required software and systems changes to enable other companies to use our network and compete for our customers.

As a result, a national trade group of competitive telecom companies stated that Bell Atlantic was a "model" for how existing local phone companies could work to introduce competition. Unfortunately, such truthfulness was not well received by one of the big three: Citing the statement, MCI-Worldcom subsequently quit the trade association. Effective, widespread competition in the local market will happen as soon as Bell Atlantic is free to offer a variety of services -- including long-distance -- and give the big three a much-needed run for their current customer base.

Sherry F. Bellamy is president and chief executive officer of Bell Atlantic -- Maryland, Inc.

Pub Date: 2/04/99

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