AT&T; Wins Fight to Offer Customized Phone Service
The Federal Communications Commission gave American Telephone & Telegraph the go-ahead Friday to offer customized long-distance service to large corporate and government customers.
The commission, denying challenges by MCI Communications, US Sprint and others, said AT&T;’s so-called Tariff 12 had not been shown to be illegal or discriminatory.
The decision was seen as a major victory for AT&T;, battling to retain a share of the important market for custom-designed networks that large companies use for internal communications.
Originally, the FCC declared the plan illegal in an April 18 ruling because it was not equally available to all customers with similar needs. However, the commission suspended a two-year investigation and allowed AT&T; to continue offering the plan while giving the company 30 days to revise it.
Competitive Ploy Charged
AT&T; filed a revision in May in the midst of a slew of challenges by competitors who said the tariff was a disguise for predatory pricing. AT&T; said in its revised offering that it wouldn’t penalize companies that dropped the plan, also adding some services and changing some rates.
Gerald Brock, the FCC’s common carrier bureau chief, said Friday that “no compelling argument has been presented that the proposed tariff is so patently unlawful as to warrant rejection.”
He also said there was no evidence that further investigation was warranted.
“The controversy stems solely from competitors attempting to roll regulatory logs at AT&T; each time it wins what they have lost in fair, open competition,” said AT&T; spokesman Herb Linnen.
US Sprint spokeswoman Janis Langley said the FCC action was further evidence “of the illegality and unlawfulness of the FCC order suspending the (Tariff 12) investigation and it’s also evidence of the FCC’s intention to rubber stamp all of the Tariff 12 filings.”
Kathleen Keegan of MCI said her company was disappointed “with the FCC’s failure to recognize Tariff 12 is a customer-specific vehicle for offering discriminatory rates on services that are generally available.”
“We believe that the court appeal will affirm our view,” she said.
The FCC, MCI, Sprint and the Independent Data Communications Manufacturers Assn. filed suit against the April ruling in the U.S. Court of Appeals. That action is pending.
Tariff 12 first was used in 1985 to provide a service to the Defense Department and its 12 users, including General Electric, Ford Motor and Du Pont Co. Opponents said it was designed to disguise rate discounts and that AT&T; was illegally selling the service below cost.
