SBC Approved to Offer Long-Distance in Nevada
SBC Communications Inc. won federal approval Monday to offer long-distance service to Nevada residents after finally getting government recognition that certain wireless companies are eating into its telephone business.
For the first time, the Federal Communications Commission determined that a wireless carrier of broadband personal communications service, or PCS, provided sufficient competition to satisfy a key criterion for allowing SBC to enter the long-distance market.
SBC, the dominant local carrier in Nevada, California and 11 other states, has long argued that it faces stiff competition from wireless companies and from certain cable companies such as Cox Communications Inc., which offers telephone service in San Diego, south Orange County and other communities SBC serves.
The argument has fallen short in other FCC proceedings because cellular phone companies such as Verizon Wireless are not viewed the same as PCS providers, which operate on a different part of the spectrum. The commission set PCS as an exception in a 1998 case.
The FCC, which cannot use cell phone companies as a barometer for competition, has based rulings previously on competition from other wire-line companies, such as AT&T; Corp. and WorldCom Inc.
But on Monday, the FCC ruled unanimously that Cricket Communications Inc., a wireless PCS carrier in 19 states that has filed a Bankruptcy Court petition to reorganize its debts, provides the requisite competition in Nevada.
Three commissioners, in separate opinions agreeing with the decision, said they were concerned that competition from one wireless service is sufficient in Nevada, where there is little competition from wire-line companies using their own facilities.
And Commissioner Michael J. Copps said it was premature to equate wire-line and wireless services, particularly because wireless suffers from such shortcomings as service quality.
SBC can offer long distance in eight states, including California. The FCC is expected to decide Wednesday whether SBC could sell long-distance service in Michigan.
SBC shares rose 48 cents to $21.19 on the New York Stock Exchange.
The approval was announced after the close of regular trading. Shares were unchanged in after-hours trading.
