
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, May 29, 1993                   TAG: 9305290141
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-2   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

PHONE-COMPANY VENTURES APPROVED

Regional telephone companies got a green light from a federal appellate court Friday in their drive to publish electronic information such as sports scores, advertising, medical records and home education programs.

Over objections by consumer groups, newspapers and other competitors, the three-judge appellate court unanimously upheld a district judge's order allowing the seven "Baby Bell" telephone companies to produce and package information for sale across business and home phone lines.

The U.S. Court of Appeals for the District of Columbia said competition in the mushrooming market for computer and video services and regulatory safeguards are sufficient to prevent the regional Bell companies from gaining a monopolistic advantage through their ownership of the phone lines.

Gene Kimmelman, legislative director for the Consumer Federation of America, called the ruling disappointing but not surprising in view of other recent court decisions on the issue.

"A lot of us are going to have to consult on whether this ought to be appealed," he said. "It reinforces the need for Congress to step in and set some rational rules for the entire industry."

Kimmelman's group contends that phone customers have been overcharged $30 billion since the breakup of AT&T, with much of the revenue funneled into unregulated information ventures by the Baby Bell companies. said.

The judges dismissed concerns that the regional Bells could use revenues from subscribers of regulated basic phone service to subsidize their information ventures or drive rival providers out of business by degrading transmission service to them.

"It is worth noting here the character of some of the firms that the Bell operating companies would have to drive out," the panel said in a 24-page decision written by Circuit Judge Stephen Williams.

"They include General Electric, AT&T, IBM and Sears with their Prodigy service, Merrill-Lynch, ITT, Mead Corp., American Express, Citicorp, Chase Manhattan Bank and a variety of foreign and independent telephone companies," the court said. "These firms are not pushovers."

Such information service giants operating throughout the country "will have the capacity and incentive to bring anticompetitive conduct to the attention of regulatory agencies," the court said.

by CNB