SBC May Lose 13 Million Phone Lines to Rivals

SBC Communications Inc. may lose 13 million phone lines through the end of 2003 to rivals who lease the company’s network at rates it says are unfairly low, according to Chief Financial Officer Randall Stephenson.

At the current rate, SBC’s share of the local-phone market in the Southwest, Midwest and California would fall to 66% from 85%, according to a presentation the company gave the Federal Communications Commission last week.

Rivals taking 13 million lines from SBC, which had $45.9 billion in revenue last year, would translate into a loss of more than $3 billion in annual sales.

San Antonio-based SBC, the second-biggest U.S. local-phone operator, had a second-quarter sales drop of 5.5% as the number of phone lines fell 3.8%. The sales decline will accelerate if regulators don’t raise prices the company can charge rivals, Stephenson said.