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To: steve harmon - analyst who wrote (340)	2/28/1999 9:13:00 AM
From: Hiram Walker	Respond to of 4337

Steve, what do you think about the FCC ruling last week,and what ramifications it may have on ISP's over the next 12-18 months? This has the potential to give the RBOC's great leverage,but then again they don't know how to use a lever,it is not part of the psuedo-monopolists code. February 27, 1999: Kennard: No hike in Web Access Fees Washington -- Federal Communications Commission chairman William Kennard said Friday that Internet access fees will not rise as a result of the agency's decision on Thursday to classify Internet access on a dial-up basis as interstate traffic. Kennard, responding to FCC commissioner Harold Furchtgott-Roth's charge that the agency had opened the door to higher Internet connection bills, said the FCC has done nothing to alter Internet access providers' exemption from paying interstate access fees to local phone companies. "The FCC will not impose long distance charges for dialing up the Internet," Kennard said in a statement. "Consumers should see no changes in their Internet or phone bills, either in the short run or long run, as a result of this order." A Baby Bell source said the FCC decision's could lead to higher Internet access fees for dial-up subscribers because incumbent phone companies might be able to reduce their "reciprocal compensation" payments to local exchange competitors that serve Internet service providers. Higher rates would result if local exchange competitors seek to make up the revenue loss from their customer ISPs. However, a spokeswoman for the United States Telephone Association said that in the end it was not necessarily the case that Internet access subscribers would see higher rates. - 2/26/99 Hiram