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AT&T; to Trim Cost of Interstate Calls by 8.1% on Jan. 1

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Times Staff Writer

Reflecting a further shift in long-distance calling costs, American Telephone & Telegraph said Monday that it intends to trim another $1.2 billion from its interstate tolls--an average rate cut of 8.1%--effective Jan. 1, 1987.

If approved by the Federal Communications Commission, the latest reduction would cut the cost of using AT&T;’s long-distance service by 27% in the three years since the breakup of the old Bell System. Since then, however, phone customers have begun paying their local phone companies $2 a month in new “access charges,” thus eroding most of the savings.

The access charges were imposed by federal and state regulators in an attempt to distribute the true cost of originating and completing long-distance phone calls between carriers and their customers. As consumers begin paying more, the carriers are beginning to pay less--and the regulators require AT&T; and its competitors to pass these savings on to their customers.

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In an interview in Los Angeles, AT&T; Chairman and Chief Executive James E. Olson said $1 billion of the $1.2-billion reduction stems from lower charges that AT&T; pays local phone companies for beginning and completing long-distance calls. Olson added, however, that consumers should probably pay “at least” $4 a month in access fees to remove remaining subsidiaries for their use of the local phone network to make long-distance calls.

The new rates for AT&T; were also spurred by an FCC order to cut the profit margin for the company’s interstate business to 12.2% from 12.75%, also effective Jan. 1.

These moves set the stage for AT&T;’s latest rate cut. Under the plan, AT&T;’s long-distance customers would realize the largest rate cuts for prime-time calling Mondays through Fridays from 8 a.m. to 5 p.m.

“That’s where the (profit) margins are greater,” observed AT&T; spokesman Dan Coulter. “Weekend and evening rates are already a bargain.”

Weekday rates are to fall by 11.6%; evening calls (placed between 5 p.m. and 11 p.m.) by 6.2% and night rates (placed from 11 p.m. until 8 a.m. and on weekends) by 2.7%.

For example, a five-minute call during the week between Los Angeles and such cities as New York, Washington, Atlanta and Miami now costs $1.99. Under the new schedule, it would cost $1.73. In addition, the evening rate would drop to $1.07 from $1.19, and the night rate would fall to 81 cents from 87 cents.

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Similarly, a five-minute call between Los Angeles and Chicago, Dallas or Kansas City, Mo., which now costs $1.84, would drop to $1.66 weekdays. The $1.10 evening rate would fall to $1.02, and the 80-cent night rate would fall to 78 cents.

A previous 9.5% rate cut went into effect June 1. It was calculated to save AT&T; customers $2 billion, which made it the largest single reduction in history. AT&T;’s prime competitors, MCI Telecommunications and US Sprint, reduced rates later in the summer, but the spread between AT&T;’s higher rates and those of its competitors has been shrinking.

Spokesmen for both MCI and US Sprint said their rates would remain competitive.

FCC Chairman Mark S. Fowler, contacted in Phoenix, where he was attending a meeting of state regulators, expressed pleasure at news of AT&T;’s proposed rate cut.

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