FCC to Grant Bell Atlantic Entry Into Long-Distance Market
Bell Atlantic Corp. will become the first of the Baby Bells allowed into the $80-billion long-distance market, signaling a new era of competition in the communications industry, the New York Times reported in today’s editions. The announcement expected today from the Federal Communications Commission would allow Bell Atlantic to sell long-distance services to the 6.6 million households it serves in New York state. Approval would mark the first time since the breakup of AT&T; 15 years ago that consumers would be able to get both local and long-distance phone services from an offspring of Ma Bell. Executives close to Bell Atlantic said the company planned to mount a big marketing campaign beginning in January to promote its long-distance service.
Over the next few years, the FCC is expected to allow the Baby Bells to enter the long-distance market in many states, presenting AT&T; as well as the other long-distance titans, MCI WorldCom Inc. and Sprint Corp.--which have agreed to merge--with powerful new competitors who already enjoy relationships with customers. SBC Communications Inc., the largest local phone company, which does business as Ameritech, Southwestern Bell and Pacific Bell, is expected to ask the FCC as early as January for approval to offer long distance in Texas.
Micro Warehouse Announces Sale: Micro Warehouse Inc. said it would be acquired for $725 million, or $19 a share, by an investor group led by former IBM executive Jerome York, Northwest Airlines Corp. Chairman Gary Wilson and Los Angeles investment firm Freeman Spogli & Co. Other investors include Alfred Checchi, former co-chairman of Northwest Airlines and a former candidate for governor of California, Hollywood power broker Michael Ovitz, and Alfred Boyer of Boyer Capital Management. The deal values the Norwalk, Conn.-based firm at a 44% premium over the stock’s slumping average price in the last 30 days. The firm has struggled with competition from online retailers, falling sales for its core Apple Computer Inc. product lines, management turmoil and shareholder suits. News of the deal sent Micro Warehouse shares up $2.81 to close at $18.06 on Nasdaq.
