Pacific Bell Plans $1-Billion Modernization : Telecommunications: The company says advanced new services will be available throughout the state by 1997.

Pacific Bell said Monday that it will spend $1 billion over the next five years to modernize its network in California, making many advanced telephone services available to customers, including some forms of video images.

The state’s largest phone company said that by 1997 all of its business and residential customers will have access to the much-vaunted Integrated Services Digital Network (ISDN) services.

These services range from high-speed computer data transmission demanded by business to the latest residential custom calling features, such as priority ringing, voice mail and select call forwarding.

ISDN is required for emerging telephone video services, such as high-quality picture phones for homes and improved video conferencing for offices.

Nearly 40% of Pacific Bell’s customers, notably those in the Los Angeles and San Francisco areas, are already served by ISDN.

The company’s announcement Monday affirms its intention to step up the pace of its modernization in the remainder of the state.

Pacific Bell said the decision will require it to increase spending on network improvements by the equivalent of $300 million by 1997.

Pacific Bell President Philip Quigley said installing the latest telecommunications technology should help the state snap out of its economic woes.

“Modern telecommunications is . . . a critical part of the economic and social framework that determines the quality of everything from our industry to our schools to our air,” he said.