To: Anthony Wong who wrote (3921 ) 2/10/1999 11:32:00 PM From: Anthony Wong Respond to of 11568
US West Thwarted MCI Unit, Rivals, Washington Regulators Rule Bloomberg News February 10, 1999, 6:16 p.m. ET US West Thwarted MCI Unit, Rivals, Washington Regulators Rule Olympia, Washington, Feb. 10 (Bloomberg) -- US West Inc., the sixth-largest U.S. local phone company, thwarted a unit of MCI WorldCom Inc. from offering local phone service and must remove barriers so rivals can more easily compete, Washington state regulators said. MCI Metro, a subsidiary of the No. 2 U.S. long-distance company, complained to the Washington Utilities and Transportation Commission in June 1997 that US West was preventing competitors from entering local markets in the state. In a blow to US West, the commission agreed that the company violated state law and ordered the company to take steps requested by the MCI WorldCom unit, including providing status reports of customer-service requests. The commission didn't fine US West, though it signaled penalties were possible if the company doesn't meet the requirements. ''In agreeing with MCI WorldCom on all counts, the WUTC has exposed US West's deliberate policy of blocking competition,'' said Bill Levis, an MCI WorldCom spokesman. US West has 10 days to ask the commission to reconsider its ruling, or it could appeal the order in court. The Denver-based company may appeal because it doesn't believe it broke any laws, said spokesman Mark Reynolds. Also, ''we believe we comply with many of the requirements'' MCI Metro requested. The dispute arose when the MCI WorldCom unit charged that US West wasn't meeting the terms of a so-called interconnection agreement between the two companies. That contract allows MCI Metro to access US West local networks and provide local phone service in the state. Today's ruling wasn't all negative for US West, Reynolds said. The commission rejected MCI Metro's call for up to $17.5 million in fines, and didn't find that US West's policy was ''willful and intentional misconduct,'' he said. Still, WUTC Chairman Anne Levinson, in a separate opinion, took a stronger stance. ''US West's behavior suggests it may be the company's corporate choice to operate its business in a way to impede the development of competition by both active and passive means,'' Levinson wrote. US West shares fell 3/8 to close at 61 1/2. Shares of Jackson, Mississippi-based MCI WorldCom fell 1/2 to 76 1/4. The largest regional local phone companies are required by state and federal laws to open their networks to rivals, as part of a broad effort to spur competition for local phone service. --Alan M. Wolf in Washington (202) 624-1880/pkc