11% Cut in Long Distance Rate Ordered

The Federal Communications Commission today ordered the American Telephone & Telegraph Co. to slash long-distance rates by an average 11% effective Jan. 1, saving consumers $2 billion in the new year.

FCC Chairman Mark Fowler called the government order “truly good news for American consumers” and said that with the latest decrease, long-distance rates have dropped by about 30% since 1984.

“We project that the price of the average long-distance call will drop 11% with no change in local telephone rates,” Fowler told a news conference, adding that the cuts will be 50% greater, or $1.85 billion more, than those proposed by AT&T; two months ago.

AT&T--which; is already planning a series of more than 27,000 layoffs to cut costs--is the dominant provider of long-distance telephone service in the United States.

All Service Affected

The FCC said the cuts will affect all classes of AT&T; long-distance service, but the biggest reductions will be in night and weekend rates, historically the lowest.

“This will be the fourth long-distance rate reduction in four years,” Fowler said. “With this latest reduction the average American will be paying long-distance rates that are about 30% lower than they were on Jan. 1, 1984.

“This means it’s easier for friends and family to keep in touch in this the information age,” Fowler said. “Now the good news will come right away, because for example those University of Michigan fans out at the Rose Bowl will be able to call Ann Arbor, and a call that was $2.53 on New Year’s Day in 1984 will be only about $1.68 on New Year’s Day 1987.

“Overall these rates will save long-distance customers more than $2 billion,” Fowler added. “The reductions are the direct result of FCC programs to encourage more efficient use of one of this nation’s greatest resources--our telecommunications network.”