FOR IMMEDIATE RELEASE
August 5, 1996
BELL ATLANTIC-PENNSYLVANIA SAYS NEW RATE STRUCTURE IS NEEDED
TO MEET ACCELERATING COMPETITION
Rate Rebalancing Would Generate No Added Revenues
Harrisburg, PA -- In response to the rapidly changing
telecommunications landscape, Bell
Atlantic-Pennsylvania has proposed
a "rebalancing" of its rate structure which positions the
its customers for accelerating competition, Catherine A. Eichenlaub,
Bell Atlantic director of Line of Business Regulatory Support for Bell
Atlantic, today told the Public Utility Commission.
"Many Bell Atlantic-Pennsylvania residential customers will have an
opportunity to save money under the company's proposal, while the
remainder will see a modest increase in basic telephone rates - the
first in over a decade," Eichenlaub said.
Bell Atlantic has proposed increases in dial tone line rates for its
Pennsylvania customers. These increases may be offset by an
elimination of the separate charge for Touch Tone service and a
decrease in most residential unlimited local packages. Customers will
save additional money through an automatic ten percent discount if
they place $5 or more each month in toll calls. This discount is an
extension of the twenty percent discount already offered to customers
making $20 or more in Bell Atlantic toll calls each month. Both
discounts are applied automatically, so that customers need not sign
up for any special calling plans.
"Although some rates have increased, others have decreased, so Bell
Atlantic will receive no additional revenue as a result of the
proposal," Eichenlaub said. The filing also includes changes
impacting business customers, who will see decreases in their bills
primarily as a result of reductions in toll rates proposed by Bell
Eichenlaub appeared today before the PUC to explain the company's rate
proposal and address specific issues raised by the commission and
other parties regarding the filing.
The current Bell Atlantic rate structure was created under the old
monopoly framework in which regulation, not competition, determined the
rates and service choices of customers. "As the local market is
to competition and customers have a choice of local service providers,
it's necessary to restructure our rates because the game and the rules
have changed," Eichenlaub said. "The Telecommunications Act of
has broken down all the barriers and opened the doors to competition."
Five competitive local telephone companies already have been certified
to provide telephone service in Pennsylvania and five other companies
have petitions pending before the PUC.
"As our business and toll revenues decrease due to competition, so
will the subsidies that historically kept residential and rural
services priced so low," Eichenlaub said. "In a competitive
marketplace, artificially low basic telephone rates which don't
recover the cost for us to provide the service are an impediment to
fair and open competition, fair prices and customer choices.
The appropriate economic incentives for companies to compete with Bell
Atlantic will not exist until rates are better aligned with costs."
Eichenlaub said Bell Atlantic is concerned about all customers, and
provisions are in place to aid low-income households. Bell Atlantic
is the only telephone company in Pennsylvania to offer Lifeline
Service, which provides low-income residential customers with a $5
credit on monthly phone bills and, coupled with Link Up America
benefits, eliminates the line connection charge. The company also
funds the Universal Telephone Assistance Program (UTAP), which helps
Lifeline customers pay their basic phone charges in times of crises.
While Bell Atlantic pays for the program, it is administered by the
Salvation Army, which verifies customers' eligibility and determines
the amount of assistance to be provided.
"Today, almost 97 percent of Pennsylvania's citizens have telephone
service, one of the highest levels of subscribership in the nation,"
Eichenlaub said. "Bell Atlantic's Lifeline Service and Universal
Telephone Assistance Program will help preserve and improve that high
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.
- Shirley Risoldi (412-633-5574)