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For Immediate Release
July 26, 1999

VINCENT J. FUMO, 1st Senatorial District
ROGER A. MADIGAN, 23rd Senatorial District
MARY JO WHITE, 21st Senatorial District

PUC DECISION WILL INCREASE COMPETITION, HELP CONSUMERS

HARRISBURG, August 26, 1999 - Three state senators who have been deeply involved in telecommunications issues today commended the Pennsylvania Public Utility Commission (PUC) for its order opening up local telephone markets to competition.

Senators Vincent J. Fumo (D-Philadelphia), Roger Madigan (R-Towanda) and

Mary Jo White (R-Venango) believe the PUC has crafted a fair and reasonable decision that will bring the promised benefits of competition to consumers.

"Once implemented, the order will bring lower rates, improved services, innovative and modernized products, and economic development to the people of Pennsylvania," said Fumo.

The senators had actively litigated this matter before the PUC and presented extensive expert testimony in the so-called global telecommunications case that was decided today. The senators argued that the markets of incumbent local phone carriers, most notably Bell Atlantic, were not opened to competition as required by a state law passed in 1993, as well as by a 1996 federal law.

"Clearly, the commission recognized that real competition for local phone service does not exist today, and it recognized that it had to act aggressively to create a competitive climate in all parts of the state," said Madigan.

"Today’s decision moves Pennsylvania forward to allow consumers to have a genuine choice when they sign up for local phone service, and that will mean lower prices and improved service for parts of the state have been taken for granted in the past by their phone company," said White.

The senators had jointly sponsored legislation in this session to further phone competition. The provisions of one of their bills was essentially ordered by the commission today – structural separation of Bell Atlantic into subsidiary companies, meaning that the company that maintains the telephone network will be different from the company that markets telecommunications products to consumers.

Fumo said he would strongly defend the commission’s decision should Bell Atlantic appeal. "We believe the commission clearly has the statutory authority to order structural separation and we will aggressively argue that in court if we have to," Fumo said. "That is one of the critical points of the order because it creates a fair, level playing field for all companies."

White hailed the part of the order lowering the fees that Bell Atlantic charges other companies for access to the existing phone network. The commission noted that those fees are currently much greater than cost, which puts Bell at a competitive advantage. "I believe that the UNE rates as set by the commission are at a level that will better able other companies to enter the local phone service market in a way that makes business sense," White said.

Madigan said he was especially pleased that the commission’s decision includes financial incentives for companies to compete for rural and residential customers. When competitors enter these previously under-served markets, they will receive even further discounts in access fees.

"This will jump-start competition in rural and residential portions of the state, meaning residents of those areas won’t be left behind while companies focus only on more densely populated regions," Madigan said.

Although they sought automatic enrollment in lifeline services and extension of class services, which the PUC did not order, the senators still believe this was a far-reaching and visionary decision that will place Pennsylvania in a clear leadership position among states when it comes to local phone competition.

The senators urged Bell to recognize that the time for true local phone competition has arrived, and to act in accord with the commission’s decision, which came following several years of intense research into telecommunication issues.

"While it has been Bell Atlantic’s practice to litigate and appeal pro-competitive decisions by other state and federal regulatory bodies, we expect that Bell Atlantic will end its dilatory practice of obstructing inroads into its local phone service monopoly and comply with today’s order," Fumo said. "Otherwise, we will continue our advocacy on behalf of Pennsylvania consumers and defend today’s order against any challenge offered by Bell."