Bell Atlantic Chairman condemns AT&T's Thanksgiving Day price hike
Smith calls on FCC to admit more long-distance competitors
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ARLINGTON, VA - Bell Atlantic Chairman Raymond W. Smith today joined in the chorus of outrage over AT&T's Thanksgiving price hike with a letter of protest to Federal Communications Commission (FCC) Chairman Reed Hundt.
Noting one calculation that shows AT&T has raised basic rates 22 percent since 1994, Smith urged Hundt to give customers genuine competition by opening long-distance markets as quickly as possible to strong competitors like Bell Atlantic.
In addition, Smith asked the FCC "to refrain from giving AT&T and the other members of the long distance cartel any more price breaks on access services" they buy from other telephone companies."These continuing rate hikes are an outrage because they hit small customers hardest, the ones with nowhere to turn," Smith further added. "There's only one way to act in the public interest. Let's stop these repeated price increases and give customers real choices by admitting the regional telephone companies into the long distance market."
Smith added that AT&T has admitted that its rate hikes for small customers "will help pay for AT&T's array of other services and expenses, including the heavily advertised flat-rate plan." Smith further notes that "it is nothing short of astounding to hear AT&T boldly declare that it plans to pay for its new wireless, Internet, data and local exchange services on the backs of its small long distance consumers."
A chorus of consumer advocates and telecommunications analysts also has condemned AT&T's Thanksgiving price hike.
Nearly all shared the sentiments of the Consumers Union co-director who told reporters that AT&T's attempt to sneak a price hike past customers celebrating a national holiday is "uncalled for." He said, "it is astounding in a market supposedly fully competitive that consumers would get socked with this kind of rate increase. Obviously, the long-distance market is not competitive."
Newspapers covering the rate increase also noted that it was just one rung on a long ladder of long-distance price hikes. According to a recent report in the Wall Street Journal, AT&T has jacked up rates by more than 20 percent over the past two years.
Smith called on consumers to demand real competition by writing to the FCC and urging commissioners to admit local telephone companies into the long-distance market immediately.
"Tell them that you want to see real competition - the kind that begins with more choices and ends with lower prices - in the long-distance markets," Smith said.
Address all letters to The Hon. Reed E. Hundt, Chairman, Federal Communications Commission, 1919 M St. NW., Washington, D.C. 20054
Bell Atlantic Corporation (NYSE: BEL) is at the forefront of the new communications, entertainment and information industry. In the mid-Atlantic region, the company is the premier provider of local telecommunications and advanced services. Globally, it is one of the largest investors in the high-growth wireless communication marketplace. Bell Atlantic also owns a substantial interest in Telecom Corporation of New Zealand and is actively developing high-growth national and international business opportunities in all phases of the industry.