Abandons One-Sided Georgia Process That Heavily Favors
BellSouth
ATLANTA, Ga., September 9, 1999 -- Concerned with a severely
limited and one-sided process tilted in BellSouth's favor, MCI
WorldCom today ended its support for testing BellSouth's ability to
switch customers in Georgia to competing local phone carriers. MCI
WorldCom instead will shift resources to Florida, where proposed
testing more closely mirrors the successful market-opening process
underway in New York.
"It's a policy decision we reach reluctantly, given our
respect for the Georgia Public Service Commission, but one that is
compelled by economic reality," said C.K. "Chip"
Casteel, Jr., regional executive for MCI WorldCom Public Policy.
"We're committed to spending the resources needed to bring
local phone competition to residential customers across America, like
we're doing in New York today. In the southern states, the Florida
test offers a better bang for the buck than Georgia."
By law, BellSouth and the other Bell local phone monopolies must
prove to regulators that they can switch customers to competing local
phone carriers as easily and conveniently as they serve their own
customers.
Beginning with New York, state regulators across the country have
ordered the Bell local phone monopolies to undergo independent tests of
their back-office ordering, installation, maintenance and billing
systems. Independent testing and certification of these so-called
operations support systems (OSS) is critical to opening the local phone
market. In fact, the New York process -- which continues pending final
state commission approval -- enticed MCI WorldCom to offer a choice for
residential local phone service there on a limited basis.
In BellSouth's territory, Georgia was the first state to order
tests of BellSouth's OSS. Florida regulators followed suit,
ordering an independent auditing firm to develop a plan to test
BellSouth's regionwide OSS systems. But the state-specific tests
have taken dramatically different paths, which led MCI WorldCom to
reach today's decision.
"Initially, we were pleased when Georgia showed its leadership
and became the first state to make BellSouth take the test,"
Casteel explained. "All the signals pointed to New York-style
testing, which helped make our residential market entry possible there.
But it's become apparent that the Georgia test has so many fatal
flaws that we now feel compelled to shift our resources to Florida,
which appears to be more serious about taking the tough steps required
to pry open Bell's monopoly local phone market."
The BellSouth back-office systems to be tested in Georgia are
essentially the same as those in Florida. Yet the method for testing
BellSouth's OSS differs significantly between Georgia and
Florida.
Based on guidelines ordered by the Florida Public Service
Commission, an independent auditing firm will develop the initial test
plan. And unlike Georgia, Florida regulators will allow new local phone
carriers to suggest revisions and test scenarios that mimic real-world
customer demand for new services. The more comprehensive Florida
guidelines, for example, call for the testing of advanced broadband
services such as high-speed DSL (digital subscriber line) service.
BellSouth's next-generation OSS, due to be implemented by next
March, also will be tested in Florida.
In Georgia, however, these market-opening test parameters and open
processes are conspicuously absent because BellSouth, not the Georgia
Public Service Commission, essentially designed its own test. Unlike
the New York process and complicating matters, competing local phone
carriers have been kept largely in the dark about the progress of the
Georgia test, as they are not allowed to participate in the meetings
and calls between BellSouth, the testers and Georgia state regulators
where issues are discussed and decided.
"The shroud of secrecy hanging over the Georgia test is one of
the primary reasons behind our decision," Casteel said. "We
will dive head first into the test being run in Florida, which can act
as the lead state for conducting tests of BellSouth's regionwide
systems. We're hopeful that Georgia will reassess its testing plans
and consider coordinating with Florida to conduct these
tests."
MCI WorldCom is aggressively moving to offer residential local phone
service to more states like New York, where it has made more than
160,000 sales statewide. Service at commercial volumes there hinges on
further actions by the New York Public Service Commission to compel
Bell Atlantic to fix remaining problems with its OSS.
In Texas, MCI WorldCom continues its active participation in testing
the Southwestern Bell local phone monopoly's OSS as MCI WorldCom
marches toward offering residential local phone service there early
next year.
In Pennsylvania, MCI WorldCom has asked state regulators to
accelerate the testing of Bell Atlantic's OSS so that MCI WorldCom
can offer residential local phone service there more quickly. MCI
WorldCom has asked to conduct side-by-side testing with the independent
auditor evaluating Bell Atlantic's OSS. Such side-by-side testing -
an approach adopted by New York - helped uncover system flaws not
identified by the independent test auditor.
In metro Atlanta and 88 other major markets across the country, MCI
WorldCom is a leading provider of competitive local phone service to
business customers. As in New York, MCI WorldCom continues to work with
regulators, legislators and its competition to bring a choice for local
phone service to residential customers in states where conditions are
ripe.
MCI WorldCom is a global leader in communications services with 1998
revenues of more than $30 billion and established operations in over 65
countries encompassing the Americas, Europe and the Asia-Pacific
regions. MCI WorldCom is a premier provider of facilities-based and
fully integrated local, long distance, international and Internet
services. MCI WorldCom's global networks, including its
state-of-the-art pan-European network and transoceanic cable systems,
provide end-to-end high-capacity connectivity to more than 40,000
buildings worldwide. MCI WorldCom is traded on NASDAQ under WCOM. For
more information on MCI WorldCom, visit the World Wide Web at
http://www.wcom.com.
