[Do What's Best for Consumers, U S WEST Asks FCC, as Final Arguments Are In on Popular Long-Distance Teaming Program With Qwest]
DENVER, July 7 /PRNewswire/ via NewsEdge Corporation -- With legal arguments for all sides now in related to its Buyer's Advantage long-distance marketing alliance with Qwest, U S WEST (NYSE: USW) today urged the Federal Communications Commission (FCC) to decide quickly on the merits of the program -- and do what's best for consumers.
"Ultimately, the issue isn't what's best for U S WEST or Qwest or AT&T or MCI," said Solomon D. Trujillo, president and CEO of U S WEST." The issue is -- or should be -- what's best for American consumers."
Trujillo noted that "AT&T and MCI have conceded publicly that the Buyer's Advantage program is a good deal for consumers. They've even said they might join with us to make a similar offer to consumers if they can't kill Buyer's Advantage on the legal front."
Last month, a federal court in Seattle issued a temporary injunction prohibiting U S WEST from continuing to market and take customers' orders for Qwest's 10-cents-a-minute interstate long-distance service under the Buyer's Advantage program. The court referred the case to the FCC, asking the commission to rule on the legality of the program under the Telecommunications Act of 1996.
In comments filed with the commission on June 26, U S WEST included extensive comments about the benefits the Buyer's Advantage program offers to consumers. AT&T, MCI and a coalition of other companies trying to kill Buyer's Advantage filed their comments with the commission by July 1, the deadline set by the FCC for reply comments.
"The thing I find amazing," Trujillo said, "is that the companies who want to kill Buyer's Advantage don't mention consumers at all in their comments to the FCC. Not once. Have they become so involved fighting legal battles that they've forgotten about the one group that really matters -- customers?"
"It's especially galling," Trujillo said, "that AT&T continues to fight Buyer's Advantage in the wake of its own proclaimed plan to create -- in their words -- an 'unprecedented powerhouse' through their merger with TCI. That merger will make AT&T the nation's biggest long-distance company, biggest cable TV operator, biggest independent local phone company and biggest wireless phone company all rolled into one. Why do they need protection from competition?"
Some of the points U S WEST made in its filing with the FCC:
-- "It is not a mystery why AT&T and MCI may have lost customers to Qwest during the three weeks that U S WEST's Buyer's Advantage program operated: Customers learned that Qwest offered significantly cheaper long-distance services than either of the giants. The average residential customer in U S WEST's region had, for the past three years, paid more than 16 cents per minute for long-distance (interLATA) service. Qwest offered those same customers a simple, day-and-night rate on interstate calls of 10 cents per minute."
-- "All it took for these customers to switch was to know about Qwest's offer. U S WEST did not suggest that Qwest's long-distance services were its own. Nor did U S WEST disparage the services of any other carrier or deny customers the right to choose another carrier. It did not offer customers special prices or terms on U S WEST services if they chose Qwest. And U S WEST did not give Qwest superior interconnection, cheaper exchange access, or any other special benefit that would have enabled Qwest to provide customers with better-quality long-distance service than its rivals. The only thing U S WEST provided was an avenue for giving customers accurate information about Qwest's simple low prices."
-- "In three weeks, fully 130,000 customers who had learned about Qwest's prices through Buyer's Advantage chose to switch. But instead of meeting Qwest's initiative with a competitive response in the marketplace, the Complainants asked a court and now the Commission to prevent their far smaller competitor from using a marketing channel that had proven too effective for their comfort."
-- "The sad irony is that AT&T and MCI -- with $57 billion in long- distance revenues last year, and nearly 80% of the nation's presubscribed residential telephone lines -- are using the procompetitive Telecommunications Act as a weapon to preserve their dominance of the long-distance market ... AT &T and MCI turn Congress's intent on its head when they twist a statute whose stated purpose is '(t)o promote competition ... in order to secure lower prices and higher quality services for American telecommunications consumers' into a shield against a smaller rival's attempt to publicize its lower rates. "
-- "The position that AT&T and MCI advocate would thwart competition by depriving customers of choice and of information useful in choosing telecommunications services. Teaming arrangements such as Buyer's Advantage allow customers to obtain the simplicity and convenience of one-stop shopping for local and long-distance services. They also afford smaller long-distance carriers a low-cost marketing channel that better enables them to compete by informing consumers about their offerings."
-- "A program such as Buyer's Advantage increases choice for everyone and reduces it for no one: Consumers retain all other options previously available to them; U S WEST and Qwest retain all other avenues of competition; and other long-distance carriers may choose to participate or to pursue any other marketing strategy."
-- "Qwest is an emerging facilities-based long-distance provider based in Denver, Colorado, with less than 2% of the long-distance market, compared to the over 75% that AT&T and MCI together control. Qwest has a state-of-the-art fiber optic network, offers low rates, and has steadily built a name for itself, but it has nowhere near the market power, name recognition, or advertising budget that the long-distance giants have. Qwest entered into the Teaming Agreement with U S WEST in
an effort to compete more vigorously and efficiently using a new, cost-effective marketing channel."
-- "Buyer's Advantage offers customers convenient one-stop shopping, although it is carefully structured not to lock customers into U S WEST's or Qwest's service offerings, tie those offerings together, or disable any other local or long-distance carrier from competing. Qwest's same 10-cent all-day rate is tariffed and available to customers even if they do not participate in Buyer's Advantage. Similarly, U S WEST's services are available at the same tariffed price outside the program."
-- "Customers can mix and match single or multiple services from U S WEST, Qwest and even third parties; there is no price break for selecting a particular combination of services from Qwest and U S WEST, and there is no minimum package that must be purchased. (Thus, AT&T and its co-Complainants are simply wrong when they assert that customers must accept U S WEST's intraLATA toll services in order to receive Qwest's favorable long-distance rate.) In short, participation in the program comes without strings: A customer may take only what she or he wants, in any desired combination. Buyer's Advantage simply gives the customer a convenient single point of contact for ordering U S WEST's and Qwest's services."
-- "As the Teaming Agreement itself makes clear, the arrangement between U S WEST and Qwest is nonexclusive, and expressly permits both carriers to enter into similar arrangements with other carriers. U S WEST has stated unambiguously that other carriers may participate in the program on the same terms as Qwest, or with lower long-distance prices. Moreover, U S WEST is willing to consider alternative teaming arrangements should a prospective teaming partner propose them."
-- "AT&T and MCI initially declined to take advantage of the opportunity, although they have subsequently shown a change of heart: They have publicly declared an interest in teaming with U S WEST, even as they protest in their litigation papers that participation would be unthinkable to them. Meanwhile, other carriers have continued to discuss the possibility of teaming with U S WEST, even while AT&T's and MCI's litigation is proceeding."
SOURCE U S WEST |
