Bell Atlantic and GTE Cite Merger Benefits In Pennsylvania Testimony

Bell Atlantic and GTE Cite Merger Benefits
In Pennsylvania Testimony

Companies Point to Competitiveness, Efficiencies,
Economic Growth

March 23, 1999


Sharon Shaffer, Bell Atlantic

Sara Vuick, GTE

HARRISBURG, Pa. -- The Bell Atlantic-GTE merger will ensure a more
competitive battle in the commonwealth's telecommunications markets,
resulting in benefits to all Pennsylvanians, according to testimony filed by
the company with the Pennsylvania Public Utility Commission (PPUC).

Benefits include:

  • new competition for bundled packages of services;
  • cost savings that will enable the new combined company to
    provide consumers with the best value for their money;
  • expansion of GTE's Internet business and data capabilities;
  • local economic development; and
  • improvements in service quality.

Several of the companies' largest competitors are expected to respond
today to the filing.

In testimony, Daniel J. Whelan, president and CEO of Bell Atlantic -
Pennsylvania, said, "The enhanced scale and scope of the combined
company will benefit the market for bundled telecommunications services
aimed at large-volume business customers." Whelan noted that this is a
market where many of the merger's primary opponents -- notably AT&T,
which has already completed a succession of mergers -- have a strong

Benefits of the Bell Atlantic-GTE merger will extend to all markets,
Whelan explained, "especially given the greater ability and incentive for
the combined company to develop GTE's Internet business."

He added, "Residential consumers will benefit because increased
efficiencies in areas such as procurement, testing and research and
development, will decrease the unit cost of serving them, thereby
alleviating pressures for price increases and enhancing the service that can
be provided at current prices.

"The presence of the stronger combined company will stimulate the
regional economy generally and will be good for employment -- which is
why Bell Atlantic-Pennsylvania's primary labor union, the
Communications Workers of America, has come out strongly in favor of
the merger before the Federal Communications Commission."

Whelan added that combining expertise will allow the companies to offer
better customer service, and he debunked claims that the merger would
affect the already competitive market for local services. "GTE is not a
significant competitor, or even a perceived significant potential
competitor, in Bell Atlantic's service area," he said.

In testimony on behalf of GTE, John O. Dudley, GTE assistant vice
president for regulatory and government affairs, said, "The merger of GTE
and Bell Atlantic will create an organization better able to compete
effectively in the new telecommunications environment than either
company could individually."

Dudley noted that the combined company would stimulate long distance

"The merger will create a fourth national, facilities-based carrier capable
of mounting a credible, competitive threat to AT&T, Sprint and MCI
WorldCom," he said.

Bell Atlantic and GTE announced in July 1998 that they planned a merger
of equals. To date, 24 state public utility commission have either
approved the merger or declined to assert jurisdiction over it. Regulators
in 14 other states and federal regulators are currently considering the
public interest benefits of the merger. More information is available at
Bell Atlantic's News Center on the World Wide Web (http://www.ba.com)
or at GTE's homepage (http://www.gte.com).