Another Call Goes Against PacBell in Long-Distance Bid

A state regulator late Tuesday recommended that Pacific Bell be denied entry into the long-distance phone market, arguing that the company’s local phone markets are not sufficiently open to rival carriers.

The proposed ruling, while not unexpected, is another in a string of setbacks for PacBell. The California Public Utilities Commission is scheduled Thursday to discuss the ruling, issued by an administrative law judge, Jacqueline Reed.

The California PUC’s final decision will be forwarded to the Federal Communications Commission, which will ultimately decide if PacBell has earned the right to expand into long distance.

In October, a PUC staff report harshly criticized PacBell for thwarting competition in the local phone market, where PacBell remains the dominant carrier. Reed’s ruling adopts many of the findings from that staff report but also includes some modifications and lays a course for PacBell to follow if it hopes to offer long-distance service.

Despite the tentative verdict issued Tuesday, PacBell was heartened by Reed’s inclusion of “clear and finite guidelines for our entry into long distance,” said Bill Blase, the company’s vice president for regulatory issues.

PacBell and other local phone companies have been pressing to earn the right to compete against AT&T;, MCI, WorldCom, Sprint and others in the nation’s $70-billion market for long-distance phone service.

But under the Telecommunications Act of 1996, each of the so-called Baby Bell phone companies is prohibited from competing in long-distance until it proves that it has fully opened its local phone market to competition.

As part of the Telecom Act, each local phone company must comply with a detailed 14-point checklist before state and federal regulators will consider approving an application for long-distance service.

So far, none of the companies has made it past the minimum requirements. Regulators have concluded that PacBell has met just four of the 14 listed guidelines.