To: MR. PANAMA (I am a PLAYER) who wrote (45509 ) 3/13/1999 6:39:00 PM From: Glenn D. Rudolph Respond to of 164684
FOCUS-Telekom<DTEG.F> online price plan blocked-AOL (adds court ruling, detail and background throughout) By Neal Boudette FRANKFURT, March 12 (Reuters) - Deutsche Telekom AG <DTEG.F> on Friday was blocked from implementing a new pricing plan for its online service, adding to a growing list of legal challenges facing the former monopoly phone company. In response to a complaint from the German unit of America Online Inc <AOL.N>, the Hamburg district court ruled Telecom's T-Online unit could not go ahead with a pricing plan that had been due to take effect on April 1, AOL told Reuters. Under the scheme T-Online users would pay only six pfennigs per minute for the service, a rate that would cover both the per-minute charge for access to T-Online and the per-minute charge for the phone call to reach T-Online. To connect to AOL or other online services in Germany, users have to pay eight pfennigs per minute in phone charges alone. They also pay monthly or per-minute fees to AOL or their Internet service providers. "(Telekom) is offering its online service below cost and subsidising its T-Online unit, which is making a loss," AOL Germany spokesman Frank Sarfeld told Reuters. News of the ruling caused Telekom shares to fall. They closed 38.75 euros, up 45 cents, but had been tradin at 39.30 euros just before the ruling was made public. Earlier, AOL and seven other online firms filed a complaint to Germany's telecommunications regulator, Klaus-Dieter Scheurle, alleging the new price would hinder competition and give T-Online "further unjust advantage" because of Telekom's monopoly in local phone service. "It is your responsibility to stop this," the letter said. Signers included the German units of AOL and Compuserve; DaimlerChrylser AG <DCXGn.F> venture Debitel AG; and Talkline GmbH, a unit of Tele Danmark A/S <TLDb.CO>. Sarfeld said German users of AOL and Compuserve end up paying 460 million marks a year in local phone charges. The legal challenge form online services comes amid several others from Telekom's telephone rivals. On Thursday, the German unit of Star Telecommunications Inc <STRX.O> said it would lodge an informal complaint with the European Union competition watchdog, accusing Telekom of illegal pricing and other anti-competitive actions. Star would follow through with a formal complaint to the EU, depending on a successful outcome of complaints to Scheurle by First Telecom and another small phone company. First Telecom alleges that Deutsche Telekom acted illegally late last year when it told about two dozen competitors that after 1999 they would have to renegotiate agreements for linking their phone networks with Telekom's. Another group including Mannesmann Arcor AG <MMNG.F> has also filed a complaint with the Cologne district court against a regulatory decision last month that allows Telekom to charge them higher prices for local phone lines. In February the regulator ruled Telekom could charge other phone companies 25.40 marks per month for renting its "last mile" phone lines -- about 20 percent more than Telekom charges residential customers. The decision makes it difficult for other phone companies to offer competing local service. Telekom last year lost about 30 percent of Germany's long-distance market, but had lobbied the German government to push the regulator to give it more favourable ground rules in local service, the last area where it has a monopoly. In online services, Telekom faces competition, but rivals have had trouble gaining much ground. AOL is the largest online service in the world with about 16 million subscribers in the United States, and about three million in the rest of the world. But in Germany, it trails well behind T-Online, which has 2.8 million users. The other companies that signed the letter to regulatory chief Dieter Scheuerle included Callisto germany.net GmbH, IS Internet Services GmbH, Cit...