Thorough Third-Party Testing of Computer Systems Is Vital to
Assure Competition
LITTLE ROCK, Ark., October 16, 2000 -- WorldCom today asked the
Arkansas Public Service Commission (PSC) to withhold support for
Southwestern Bell's long distance bid until the company proves
conclusively that it has opened its market to competitors.
"It is crucial that the PSC not get ahead of itself by
determining that Southwestern Bell has opened its local phone market
when the facts clearly show that Bell has not removed all of the
barriers to true competition in Arkansas," said Neal Larsen,
WorldCom regional director of Public Policy. "Only one company has
the proven capability to provide local phone service on a broad scale
in Arkansas today, that is the textbook definition of a monopoly, and
that monopoly is Southwestern Bell."
The federal Telecommunications Act of 1996 requires all regional
Bell companies to prove to state regulators and the Federal
Communications Commission (FCC) that their local phone markets are open
to competitors before they can win authority to offer long distance
services in those former monopoly markets. Thus far, Bell companies in
two states have received permission to sell long distance - Verizon
(formerly Bell Atlantic) in New York and Southwestern Bell in
Texas.
WorldCom is asking the Commission to mandate intensive third-party
testing of Southwestern Bell's Operations Support Systems (OSS) --
the electronic ordering systems and interfaces crucial to establishing
a truly competitive local phone market. This type of systems validation
and testing was key to opening the residential phone markets in Texas
and New York, allowing WorldCom and other competitors to begin offering
local residential service on a broad scale in those states.
"The Arkansas PSC has the opportunity and the responsibility to
leverage Southwestern Bell's desire to get into the long distance
business to force it to release its monopoly control of the local phone
market and bring competition and true customer choice to
Arkansas," Larsen said.
A crucial element of the PSC's review of Southwestern Bell's
long distance application is to certify that the OSS that Bell uses to
serve its customers is fully functional. The FCC repeatedly has said
that rigorous OSS testing or real-life commercial experience is crucial
in deciding whether it will approve a Bell company long distance
application. Neither has occurred in Arkansas.
Southwestern Bell argues that its OSS in Arkansas is identical to
its Texas systems and so the Commission must give them a passing grade.
But the PSC must not accept claims by Southwestern Bell that its OSS is
functional without putting them through the same rigorous tests that
they were subjected to in Texas and that other Bell companies are now
conducting across the country.
"Competitors can't build their business plans on mere promises
and assurances. The law clearly requires Bell to prove its case,"
Larsen said.
"Southwestern Bell has admitted that the computer processors
that were tested in Texas are not the same ones that will handle orders
in Arkansas. In reality, the processing systems are located in
different states; Texas orders are processed in Dallas, and Arkansas
orders are processed in St. Louis. Because the computer systems for
Arkansas were not included in the Texas OSS test, the PSC needs to
conduct a comprehensive, independent third-party test to determine
whether these two different systems really are 'identical,' as
Southwestern Bell claims," Larsen said.
WorldCom also told the PSC that merely opening Bell's local phone
market is not enough to assure irreversible competition and prevent
"backsliding" once Bell gets into the long distance market.
WorldCom urged the PSC to apply comprehensive performance measurements
and strong penalties to track Southwestern Bell's service to
competitors and provide it incentives to maintain high-quality
performance as mandated by federal law and the FCC.
"Southwestern Bell needs a strong 'stick' in place as
an incentive to treat competitors fairly and suffer meaningful
penalties if it backslides," Larsen said. "Strong steps by
the PSC now will allow local phone competition to take root and grow so
that Arkansas businesses and consumers can see the same benefits that
Texans and New Yorkers are enjoying today - lower rates, improved
customer care and new cutting-edge products."
WorldCom (NASDAQ: WCOM) is a global leader in
"all-distance" communications services with operations in
more than 65 countries. Revenues in 1999 were $37 billion, with more
than $15 billion from high-growth data, Internet and international
services. WorldCom provides facilities-based and fully integrated
services to facilitate e-business and e-commerce in the digital
generation. For more information go to http://www.wcom.com.
Note: For copies of WorldCom's filing, please contact Stefanie
Scott at 512-495-6730.
