April 14, 2001
The Washington Post reports that the Federal Communications Commission is about to allow Verizon to enter the long-distance telephone market in Massachusetts. Verizon already provides long-distance service in New York, as does SBC Communications in Texas, Oklahoma and Kansas. The FCC ruling is expected on Monday.
The Telecommunications Act of 1996 provides that the former Bell companies must effectively open their local markets to competition before being allowed into the long-distance business. Some consumer advocates and competing carriers are protesting the FCC's action, which they say will reduce rather than foster competition.
"They're dead wrong," said ConsumerAffairs.com President James R. Hood. "The would-be competitors have had five years to build out their local networks. Instead of investing in infrastructure they've invested in lawyers and lobbyists, hoping to get a free ride on the Bell companies' networks."
Allowing Verizon and the other former Bells into the long-distance markets will provide consumers with the one-stop shopping the vast majority say they want, Hood said, and will reduce the confusion that now exists in the marketplace.
Others disagreed. Gene Kimmelman, co-director of the Washington office of Consumers Union, said the FCC decision "sends the signal that local telephone monopolies do not have to fully break apart their monopolies."
"Verizon reminds me of the high school senior who has still never learned how to read yet obtains a social promotion," Jonathan Askin, general counsel of Local Telecommunications Services, a trade group for Bell competitors.
Most groups that represent Bell competitors are funded largely by AT&T;, WorldCom and Sprint, who have the most to lose if the Bell companies are allowed into long-distance. The former Bells are expected to quickly gain 50 percent or more of long-distance business when they're allowed into the market, which spells big losses for the long-distance companies.
"The long-distance companies like to portray themselves as scrappy start-ups. In fact, they're like bulked-up, steroid-popping athletes. They've made big bucks for years, selling a service the Bells are perfectly capable of providing in a more convenient, more cost-efficient and less confusing way," Hood said.
