Smoke Screen of the Day

Media contacts:

For More Information, contact Eric Rabe at Bell Atlantic 215-963-6531

or Maureen Flanagan at Bell Atlantic at 212-395-3519.

"Dedicated to truth, justice, and the disclosure of

outrageous claims regarding competition in the local phone markets"



Bell Atlantic-New Jersey is expected to file a competition status report with the New Jersey Board of Public Utilities on Tuesday, March 3, 1998. We are happy to provide our updated report on competition in our local telephone markets and are pleased with the results.

However, despite the signs evidenced throughout the marketplace that competition is real and growing, some companies, including AT&T and MCI, continue to spread misinformation about Bell Atlantic's commitment to opening its local markets to competition. Even more troubling than this campaign of misinformation is that the same companies with the greatest resources with which to enter the local phone market appear to be the most reluctant to do so. Further, when they have entered the local market, it is largely to go after more lucrative business customers -- even though Bell Atlantic has opened both its local business and residential markets to competition.

In anticipation of more smoke - disinformation and unfounded claims - being spread by these companies following the release of our competition filing, Bell Atlantic wants to clear the air on our commitment to opening the local market to competition and reiterate our achievements to date.

The following are claims that have been made on a regular basis by the big long distance carriers.

CLAIM: There is a lack of competition in the New Jersey local phone market.

FACT: If there is a lack of competition in New Jersey, why have AT&T, MCI and Sprint spent millions to advertise the fact they are offering local service? AT&T actively markets local service to business customers through print and television advertisements. The company spent almost $425 million in 1996 on advertising that reached the New Jersey market, with $44 million targeted to specific markets in New Jersey. More than $284 million of MCI's $304 million 1996 advertising budget reached markets inside New Jersey, with $8 million targeted specifically to New Jersey markets. Sprint spent more than $171 million on advertising that reached the New Jersey market during 1996, $11 million was specifically targeted to New Jersey markets.

New Jersey is open for business - competition in this market is real and it is growing. Bell Atlantic has 48 interconnection agreements with competitors in New Jersey and more than 400 interconnection agreements with competitors throughout its markets. Companies, including AT&T, MCI and smaller companies such as XCOM Telephony, can offer local service in New Jersey. In fact, 26 companies have applied to offer local phone service in Bell Atlantic's New Jersey market.

  • MCI has said it will invest in markets that are expected to open most quickly to competition. One of the first markets the company invested in was Newark, NJ. This is a clear indication that this market is competitive.
  • Further, AT&T recently spent $11.3 billion to acquire Teleport Communications, one of New Jersey's largest providers of local phone service. This is a strong signal of how competitive these markets are and how much more competitive they will become. AT&T's CEO Michael Armstrong himself stated that the acquisition would speed AT&T's entrance into the local business market, cut its costs, and enable it to sell all-in-one packages of local and long distance service to businesses.
  • The fact that companies such as AT&T are willing to spend billions to acquire local phone companies, shows that these markets are open to anyone who wants to enter them, and that the companies who want to compete can.

    CLAIM: Bell Atlantic is not fulfilling its commitment to open local markets to competition.

    FACT: Bell Atlantic is not only fulfilling its commitment to open local markets to competition, the company is exceeding it.

    Bell Atlantic is spending more than $1 billion to ready its market for competition and has dedicated 1,000 employees to opening local markets to competition.

    In addition, Bell Atlantic has a unique set of commitments with the FCC to hold itself to a higher standard than other companies.

    These commitments include:

  • providing reports monitoring interconnection performance on 22 measurements;
  • providing uniform interfaces for carriers purchasing interconnection to obtain access to operations support systems, adhere to industry standards and to conduct operation testing of these interfaces;
  • proposing installment options for payment of one-time, non-recurring charges by interconnecting carriers;
  • offering shared transport as an unbundled network element at usage sensitive rates;
  • proposing prices for interconnection and unbundled network elements based upon forward-looking economic cost; and
  • adhering to these commitments for four years following August 1997.

    Bell Atlantic was the first local carrier in the nation to offer permanent local number portability service (LNP) and recently, AT&T and MCI signed up to use long-term LNP. LNP allows customers to change their local phone company without changing their phone number. Bell Atlantic will offer 90 percent of New Jersey residents permanent LNP by the end of 1998. The remaining 10 percent will receive LNP upon request. This provides dramatic evidence of our commitment to opening our local markets to competitors.

    In the New Jersey region, Bell Atlantic has:

  • more than 7,000 resold lines in service;
  • more than 14,000 interconnection trunks in operation;
  • nearly 80 collocation arrangements in operation or being implemented at our switching sites; and
  • 365 exchange codes assigned for use by our competitors, which translates to almost 4 million telephone numbers.

    Further, 65 million minutes of conversation, data and faxes passed between Bell Atlantic-New Jersey and our region competitors in 1997.

    Clearly, Bell Atlantic is dedicated to opening its local markets to competition.

    CLAIM: Bell Atlantic is not doing all it can to open local markets to competition, and as a result, it is difficult to compete with Bell Atlantic in New Jersey.

    FACT: Wrong. Bell Atlantic is doing all it can to open its local markets and many competitors are taking advantage of the opportunity.

  • Bell Atlantic has built the Telecommunications Industry Service Operations Center (TISOC) in Newark to process local service requests from competitors. The center is staffed with 72 employees, 63 of whom are service representatives specially trained to handle the needs of competitors.
  • Bell Atlantic also has built a full service maintenance center in Bridgewater, staffed with 77 employees. The center is equipped to handle trouble reports on all types of resale services and unbundled elements.
  • Bell Atlantic's ordering systems for the seven Bell Atlantic-South jurisdictions have the ability to handle 5,000 orders on a non-peak day and more than 10,000 during a peak day.

    There is no economic incentive for companies to compete in the local market.

    FACT: Not true. In 1996, telecommunications service revenue in New Jersey generated $7.2 billion.

    AT&T and MCI have the same economic incentives to compete for local service in New Jersey as Teleport and the dozens of other companies that are certified as competitive local exchange carriers.

  • WorldCom, the company with which MCI intends to merge, owns one of New Jersey's most prominent competitive local service providers, MFS, and through its network will have immediate access to many Fortune 1000 customers in New Jersey, including Merrill Lynch and Lehman Brothers.
  • In 1996, MCI's local exchange revenues grew by 93 percent.
  • In a new report on telephone trends, the FCC declared that the new local exchange carriers' revenues are growing faster than those of incumbent local exchange carriers, despite having a smaller market share.
  • Companies such as Teleport are competing in our region and around the country, and the fact that Teleport reported year-to-year growth of 89 percent in October 1997 shows that it is paying off.
  • According to Dan Reingold at Merrill Lynch, market share for all new entrants will nearly double in 1998 to 5.1 percent from 2.6 percent. And the market share for facilities and resale-based providers will grown from $2 billion in 1997 to $5.4 billion in 1999.

    The Bell Atlantic Commitment to Competition

    Bell Atlantic continues to dedicate vast resources to open local markets.

  • Bell Atlantic is spending more than $1 billion opening markets.
  • Bell Atlantic has dedicated 1000 employees to open local markets to competition.
  • 1.2 billion minutes of conversation, data and faxes have passed between Bell Atlantic and competitors in local service since January 1998.
  • 260,300+ interconnection trunks are in operation.
  • 2,402 exchange codes have been processed for use by Bell Atlantic's competitors.

    Dozens of companies are successfully doing business in local phone markets.



    The Smoke Detector from Bell Atlantic is designed to give you early warning anytime "smoke" shows up in the advertisements, press releases, public statements or reports, issued by public interest groups or the long distance companies who claim that local competition does not exist.