ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, July 16, 1996 TAG: 9607160040
SECTION: BUSINESS PAGE: B-6 EDITION: NEW RIVER VALLEY
SOURCE: GREG EDWARDS STAFF WRITER
MEMO: shorter in metro
AT&T, claiming that difficult talks with Bell Atlantic are delaying its entry into the local phone business, filed requests for arbitration Monday with public utility commissions in the District of Columbia and four mid-Atlantic states, including Virginia.
Bell Atlantic responded with its own arbitration requests to the same commissions. The company said AT&T has been making unreasonable demands and, in effect, asking Bell Atlantic to subsidize AT&T's effort to snare local phone customers.
Since March 1, AT&T has been trying to work out terms with Bell Atlantic, under which AT&T could purchase local phone service wholesale and resell it to the public. Also being discussed are terms for connecting AT&T's own network and other networks - possibly those of a cable television systems or wireless systems - with Bell Atlantic's phone lines so AT&T might provide local phone service.
The filings represent another exchange in the high-stakes battle for a share of the newly competitive and highly lucrative telecommunication marketplace.
Bill Stake, AT&T vice president for local service in the Atlantic states, said Monday that although agreement has been reached on 90 percent of more than 200 issues, little progress has been made in resolving major issues such as pricing, the use of brand names, and restrictions on reselling of services or interconnections.
AT&T has asked Bell Atlantic for discounts ranging from 31.1 percent in Virginia to 43 percent in Washington, D.C. AT&T will provide its own billing, customer service, advertising, directory assistance and other services, Stake said.
AT&T wants an additional 10 percent discount in each state and the District of Columbia. The discounts would remain in effect until interconnections between Bell Atlantic's and AT&T's networks, including those for the exchange of billing and other inter-company information, are improved.
After a hearing last month, the Virginia State Corporation Commission gave AT&T permission to offer local phone service across Virginia.
Stake said AT&T's immediate goal is to capture 30 percent of Bell Atlantic's local phone business, estimated to be worth $12 billion annually.
AT&T is one of six companies the state has permitted to compete with local phone companies since a new state law allowing competition took effect the first of the year. Just Monday, the SCC gave Cox Communications permission to offer local phone service in the Hampton Roads area and in Roanoke and surrounding counties.
The commission has at least five additional requests from companies hoping to compete for local phone service pending, including one from Sprint, which, like AT&T, is best known as a long distance provider.
James R. Young, Bell Atlantic's general counsel, said AT&T's demand for huge discounts would price the service below Bell Atlantic's cost of providing it. A local service agreement Bell Atlantic has signed with Jones Telecommunications, a Northern Virginia cable television company, calls for discounts of less than 10 percent, Young said.
The federal Telecommunications Act of 1996 gives any company involved in negotiating terms for local service the right to ask state utility commissions for help in resolving disputed or deadlocked issues. Under the time frame in the federal law, an agreement must be reached by Dec.1.
The arbitration is not binding in that either side may appeal an arbitrator's decision to a federal district court. If an arbitrated agreement is not reached by the deadline, the dispute goes to the Federal Communications Commission for settlement.
Besides the District of Columbia and Virginia, AT&T's arbitration requests were filed in New Jersey, Pennsylvania and Maryland. AT&T also wants to provide local service in the other two states served by Bell Atlantic, West Virginia and Delaware, but has not begun negotiations with Bell Atlantic in those states.
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