Bell Atlantic Corp. got the Christmas present it has been wishing for since it was separated from Ma Bell lo those many years ago. On Dec. 22, the Federal Communications Commission said it could begin offering long-distance service in New York.
Just to review. The Baby Bells and long-distance companies agreed to a carrot-and-stick approach in the Telecommunications Act of 1996. If the Bells met a 14-point checklist proving their markets were open to competition on a state-by-state basis, then they could offer long-distance service in individual states.
The decision allows the Baby Bell to offer bundled service (one operator, one bill), which it is preparing to do on Wednesday.
This was by far the biggest telecom news of the holiday period.
I said telecom. The biggest wireless news was of course the release FINALLY of the decision from the U.S. Court of Appeals for the Second Circuit (details are found elsewhere in this issue).
But since the Bell Atlantic news hit the telecom world big, it seemed everyone had something to say, starting with FCC Chairman William Kennard, who compared it to the fall of the Berlin Wall.
“We are able to finally declare that the Berlin Wall of local phone monopoly in New York has been demolished and hauled away,” Kennard said. His comments were echoed by Rep. Edward Markey (D-Mass.), who added the decision was “the most important telecommunications decision of this decade.”
Tom Wheeler and Jay Kitchen may disagree, since the auction of personal communication services licenses has meant competition for the wireless world for most of this decade (not just the last nine days as in the case of landline competition).
Another Baby Bell, BellSouth Corp., said: “The real good news is that someone’s done it. It is like hearing that someone has run the four-minute mile. Someone has done it, and now we think we can do it, too.”
BellSouth has been turned down three times in its attempt to offer long-distance service, even though it once argued people in Louisiana were using PCS service as a second line so that proved there was competition. It received news that Florida will turn over to a third-party evaluation of the local market in that state. A similar evaluation helped convince the FCC of competition in New York.
Not everyone was happy. AT&T Corp., which has been fighting to keep its dominant position in the long-distance market ever since MCI Communications Corp. won the right to compete against it, immediately asked the FCC to stay its decision pending judicial review. The FCC said no.
Not all of the long-distance giants saw red, however. Sprint Corp. said the FCC’s decision “highlights the main reasons for the pending Sprint-MCI WorldCom merger.”
Now I thought the reason for the biggest U.S. merger in history was so MCI could get its hands on Sprint’s wireless properties?
