Bell Atlantic Response to AT&T Chief Armstrong Speech
April 28, 1999
Background: The following is Bell Atlantic-Pennsylvania's response to
a speech delivered to the Philadelphia World Affairs Council today by
AT&T Chairman and CEO Michael Armstrong. This statement may be
attributed to Daniel J. Whelan, president and CEO, Bell Atlantic --
Michael Armstrong's comments to the World Affairs Council demonstrate
a lack of awareness of the status of telecommunications competition in
Pennsylvania. We hope he is given more accurate briefing materials the
next time he returns to Philadelphia for one of his stump speeches.
The local telecommunications market is irreversibly open to competitors
across the Commonwealth, with dozens of carriers certified to offer local
phone service in the state, including AT&T. Furthermore, Bell Atlantic
invests more than $18 million dollars a week improving a premier
telecommunications network for Pennsylvania.
AT&T is not interested in competing unless its profits are assured by
unrealistic discounts on Bell Atlantic services that AT&T uses. At the
same time, AT&T has made clear that it is not interested in serving small
customers -- either small businesses or at home.
Instead, Mr. Armstrong would rather demand billions in reductions in the
fees he pays Bell Atlantic to complete long distance calls.
What Mr. Armstrong will not tell customers is that his industry has raised
long distance rates 44 percent over the last two years, despite a 10 percent
reduction in these access fees. By and large, AT&T has pocketed these
savings, instead of sharing them with customers. And today, Mr.
Armstrong made no promises about what he'd do with any savings he
Mr. Armstrong is calling for these reductions to bankroll yet another cable
venture, the $50 billion purchase of MediaOne. If this merger is
consummated, AT&T will lock up 66 percent of the nation's households
on a closed, cable-modem platform, freezing out hundreds of internet
service providers and restricting consumer choices in the process.
To compete with this behemoth, Bell Atlantic and GTE are combining to
deliver a more robust suite of voice and data services to Pennsylvanians at
competitive prices. This merger serves Governor Ridge's economic
development agenda well, and is about job and business growth across the
Commonwealth. It is about keeping the hometown team at home -- not in
places like Basking Ridge and Denver.
Our network deployment strategy is on schedule, and Pennsylvanians
everywhere are benefiting from an advanced telecommunications
infrastructure brought to them by Bell Atlantic -- not AT&T.