To: pat mudge who wrote (30022 ) 12/17/1997 11:09:00 AM From: Chemsync Respond to of 31386
[MCI challenges PacTel] Hi Pat, I couldn't call up the FT link you alluded to. Too bad because Siberian weather and Central African genocides create a much fonder concept of "home". Promises to be sunny and 60ish here in the valley. I'm shoving off to the Sierra after I read the news. A "thorn" in the home fields has been PacTel. Hopefully MCI-World Com will deflate their fees. C ya later, sg p.s. I bought more WSTL today at 12 3/8. Should have listened to RayC and been more patient. MCI FILES EMERGENCY MOTION TO SPEED LOCAL PHONE COMPETITION IN CALIFORNIA Seeks Immediate CPUC Reduction of Inflated SBC/PacBell and GTE Connection Fees SAN FRANCISCO, December 11, 1997 -- MCI has filed an emergency motion with the California Public Utilities Commission (CPUC) to accelerate the expansion of facilities-based local phone competition in the state. In its motion, MCI is seeking an immediate reduction of artificially high up-front fees, known as "non-recurring charges" (NRCs), which SBC/Pacific Bell and GTE-California charge MCI and other competitors to connect individual customers to their competing local service networks. "Excessive NRCs are one of the major barriers preventing real competition in local phone service, especially for residential and small business customers," explained Richard B. Severy, regional director for MCI Public Policy. "All you have to do is look at the NRCs in other states to realize how California's charges are keeping the benefits of competition out of this marketplace." SBC/PacBell's NRCs are the highest in the nation, totaling more than $440 for a single phone line. These costs far exceed the rates charged for similar services by other Bell companies by as much as 50 times. For example, the non-recurring charges for a single phone line in Pennsylvania are only $8.90, and in New York an administrative law judge has recommended the charges be set at less than $20. "What residential customer would pay that kind of installation charge?" asked Severy. "It prevents customer choice and very effectively blocks competition for the monopoly." Federal law requires NRCs to be based on a forward-looking basis that includes advances in technology that lower costs of providing service. But SBC/PacBell's current charges are greatly inflated, by the company's own admission, because they are based on antiquated, manual processes rather than fully automated systems. MCI's emergency motion asks the PUC to immediately adopt up-to-date NRC rates for both SBC/PacBell and GTE based on new forward-looking cost figures recently submitted to the commission by SBC/PacBell. MCI hopes the commission will act on its emergency motion in January. Severy said MCI is being charged the inflated up-front fees under an interim interconnection agreement approved by the commission nearly a year ago. While the commission originally intended to lower those rates during 1997, the regulatory process has been delayed. Under the current schedule, the commission would not act to correct these charges until late 1998. "We don't think Californians want to wait that long for meaningful residential local phone competition," said Severy. "Reducing these unnecessary charges now will open the door to real choice for consumers in the California market." Facilities-based service and unbundled network elements are critical to the development of competition. MCI is a leader in providing facilities-based service, with its own state-of-the-art switched local network facilities in 25 markets nationwide, including three in California (San Francisco, Los Angeles and San Diego). However, excessive NRCs force the company to limit availability of its facilities-based local service to mid- to large-size business customers - whose size and scale allow MCI to recover these high installation costs on a reasonable basis. MCI, headquartered in Washington, D.C., offers the industry's most comprehensive portfolio of communication services. With 1996 revenues of $18.5 billion, MCI ranks as one of the world's largest telecommunications companies. MCI is also the world's second largest carrier of international traffic and operates one of the world's most advanced Internet networks. Since its founding in 1968, MCI has been a leader in bringing the benefits of long distance competition to businesses and consumers and is now leading the charge to open U.S. local calling markets to competition. On November 10, 1997, MCI announced a definitive merger agreement with WorldCom, Inc. to form a new company called MCI WorldCom. ÿ