Unfair Pricing on Small-Business Phone Systems Alleged : AT&T; Charges Asian Rivals With Dumping

American Telephone & Telegraph Co. charged Tuesday that more than a dozen manufacturers in Japan, South Korea and Taiwan were selling small-business phone systems in the United States at unfair prices and said it would file an anti-dumping petition next week.

AT&T; also said it would consider quitting the market for small-business telephone systems if the Asian manufacturers do not stop dumping their products in the United States.

AT&T; said it would file the petition Dec. 28 with the Commerce Department and U.S. International Trade Commission, charging that it and other U.S. makers of phone systems were being driven from the market as a result of pricing policies by the Asian companies.

Competitive Market

The companies, including leading Japanese electronics firms Toshiba Corp. and Matsushita Electric Industrial Co., were selling phone systems in the United States at prices far below those of their equivalent products in their home markets, AT&T; said. The two companies were not immediately available to comment.

The charges involve systems for from two to 100 phones, a highly competitive market in which customers buy largely on price and which is valued at about $3 billion a year by Northern Business Information/Datapro, a New York-based market research firm.

AT&T; did not say there was dumping of larger phone systems.

AT&T; said one in four of 48 different models was being sold in the home market for double the U.S. price charged by the foreign manufacturer.

May Leave Market

But the North American Telecommunications Assn., a trade group representing more than 750 manufacturers, distributors, suppliers, carriers, consultants and users of communications and computer equipment, said it had not seen any evidence of dumping.

Leaving the market is one option AT&T;, the largest U.S. supplier of phone systems, will explore if the alleged dumping does not stop, said Gus Blanchard, who runs AT&T;’s general business systems division.

Despite continual cost cutting and work force reductions, Blanchard’s division had “razor thin” profit margins and was only “marginally in the black,” he told a news conference.

He said that simply moving its production overseas, where labor costs are lower, would not solve the division’s problems.

Covers 17 Brands

“No amount of product improvement, cost cutting or streamlining operations could bring . . . the type of reasonable profitability and business stability” AT&T; should have as long as the alleged Asian dumping continues, Blanchard said.

AT&T;’s petition covers key telephone systems and small private branch exchanges, or PBXs, sold under more than 17 brand names in the United States.

AT&T;, which said this is the first time it has charged foreign firms with unfair pricing, said it would also cite the following Japanese companies: Hasegawa, Iwatsu, Meisei, Makayo, Nitsuko and Tamura.

The South Korean companies to be cited are Samsung Electronics Co., Gold Star and OPC. Sun Moon Star of Taiwan will also be cited.

The 12 foreign manufacturers hold about 60% of the U.S. market for small phone systems, with their share growing from about 40% in the last three years, AT&T; said. During the same period, AT&T; said overall sales of its small phone systems and those of other U.S. manufacturers have decreased dramatically.

The Commerce Department has 20 days from the filing date to decide whether AT&T;’s claims merit investigation. If it does, the U.S. International Trade Commission will begin a separate investigation to determine whether the alleged dumping has harmed the U.S. industry. The commission will make its preliminary determination within 45 days.

High Overhead Cited

It would take about a year for a final decision to be reached and the possible imposition of anti-dumping duties to begin.

Some analysts said that while the companies may be dumping in the United States, AT&T;’s real problem was that its overhead costs were too high. “AT&T; hasn’t stripped down to levels anywhere near those of its U.S. or foreign competitors,” one analyst said. “AT&T; is just not competitive.”