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To: Doughboy who wrote (2968)	2/26/1999 1:59:00 PM
From: Frank A. Coluccio	Read Replies (1) \| Respond to of 12823

>Ever wonder why it costs more to call local long distance (Charlotte to Raleigh) than it does to call from NY to CA? Or why is it that ILECs get a 30% kickback for every long distance telephone call? T< Message 8054622

To: Doughboy who wrote (2968)	2/27/1999 9:13:00 PM
From: WTC	Read Replies (1) \| Respond to of 12823

DougHboy, I'll make no effort to alter your philosophy, but, the question posed was what the future competitive landscape should look like; whether there should be a level competitive playing field for ILECs and CLECs alike insofar as some of the hidden "taxes" like the current subsidy for lifeline services. I don't agree with your assertion that < ... that is because they subsidize the lifeline and below-cost services by charging exhorbitant rates to the typical customer.> But even if we were to stipulate that your characterization is accurate, fair and effective competition is the best recourse to eliminate "exhorbitant rates." Any time one competitor operates under an artificial regulatory cost structure, the benefits of free and fair competition are compromised. Let's say the new second line subscriber line charge is only applied to ILECs. That is an extra $2 per month, growing to $6 over a period I believe is 4 years. If the CLEC is not collecting that same SLC to pass through mandated charges that support public policy, do you really think they will lower their charges by a like amount, say, $6/month? Experience seems to show that they will set prices ~10% below the ILEC, and pass the rest to shareholders. You may think that makes economic and public policy sense, based on some notion of the sins of the fathers. I know of others that find such distortions of rational regulatory fairness to be a major impediment to realizing the benefits of real competition. Count me in that camp.