SBC Bows Out Of LD For Now

April 16, 2003
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In a letter to the FCC, SBC indicated it planned to re-file the long-distance request at a later date.

The long-distance bid for now apparently fell victim to problems SBC has in billing competing local phone service providers that lease SBC’s telecommunications network to offer consumers an alternative service.

Despite extensive examination, questions remained regarding “whether SBC is currently providing wholesale billing functions” for competing local telephone providers in a manner that meets federal requirement, Federal Communications Commission Chairman Michael Powell said this morning in announcing the withdrawal.

“Ultimately, the outstanding issues that prevented approval were very narrow, but nonetheless important.  Perhaps the most troubling of these issues relates to billing,” Powell said.

Local phone service competitors who claim the telecommunications giant has not met the standards needed to secure entry into the long-distance market had fiercely opposed SBC’s long-distance application. They complain about repeated errors and delays in SBC’s wholesale billing system that has stymied competition in Michigan for local telephone service.

Powell said he personally believes SBC met the federal standards and that he’s confident SBC, in working with state and federal regulators, “will expeditiously resolve the outstanding issues that prevented approval” of the long-distance bid.

SBC, which has been seeking and has secured approval to enter the long-distance market in several states, did not have any immediate comment this morning.

In a letter to the FCC withdrawing its long-distance application, SBC said it believes federal standards for entering the long-distance market had been “fully satisfied” and that it needed “a little more time” to address questions raised by FCC staff. Withdrawing the application provides SBC sufficient time to respond to the FCC’s questions and gather additional information needed for a re-filing, SBC’s letter stated.

Dave Waymire, a spokesman for the Michigan Alliance for Competitive Telecommunications, a coalition of local phone service providers, says the application withdrawal will force SBC to address wholesale billing and other problems.

Problems with SBC’s wholesale billing system have in turn caused problems for competing exchange carriers when they bill their customers, Waymire said.

“What they wanted to do was provide a sub-standard phone system and the FCC staff saw through that,” Waymire said. “This is a win for consumers. What this means is SBC will have to go back and continue to improve on telcom infrastructure so ours is at least as good as other states with they have entered the long-distance market.”

“Billing is a huge issue,” he said.

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