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MCI Wants BellSouth to Continue Providing Its Lines for Phone Service

Posted on: Wednesday, 23 February 2005, 12:00 CST

Feb. 23--MCI, which is using BellSouth's facilities to provide local phone service in Georgia, has asked state regulators to compel BellSouth to continue providing that service at existing discounted rates.

BellSouth has long chafed at providing rivals with access to its local lines at those rates. It recently told MCI and others that it no longer will accept new orders for so-called unbundled switching or UNE-P services, effective March 11.

MCI said BellSouth's move would cause MCI to "sustain immediate and irreparable injury."

"Georgia consumers currently benefiting from the local service MCI offers in Georgia also will be injured by BellSouth's planned illegal actions," the long-distance carrier said a petition this week to the Georgia Public Service Commission.

MCI asked the PSC to hold an emergency hearing on the matter Thursday. It also asked the panel to meet next Tuesday to force BellSouth to continue to accept and process MCI's orders for local service under terms of an existing agreement between the two carriers.

A BellSouth spokesman, Joe Chandler, called MCI's complaint "groundless."

"MCI and other carriers will still have options for accessing BellSouth's network to provide service," Chandler said. "We can negotiate a long or short-term commercial agreement, as we have with almost 40 carriers, or a carrier can sign a resale agreement. No existing customers will be impacted on March 11."

BellSouth hasn't disclosed terms of the commercial agreements it has reached with 37 carriers. However, the resale rate to the carriers for local consumer service is $20.40 a month. That's higher than the current discounted UNE-P rate of $14 a month with no calling features, or $21 a month with features, according to data provided by BellSouth.

Recent federal decisions have bolstered the hand of BellSouth and other local phone companies.

As a result, some analysts, such as John Hodulik of UBS Securities, predict the regional Bells could potentially recoup more than half of the lines they lost to MCI, AT&T and other so-called competitive local exchange carriers, or CLECs.

"The Bells had collectively lost 17 million lines to UNE-P based competition as of the third quarter of 2004, representing 12 percent of their total lines," Hodulik wrote in a report last month.

He predicted UNE-P lines will drop by 7.6 million this year to only 6 percent of the total base.

Already, AT&T has announced it no longer will spend money to promote its long-distance or local service to residential customers.

Instead, it is trying to sell consumers Internet-based phone service using a technology called Voice over Internet Protocol, or VoIP.

BellSouth said its decision to no longer accept new UNE-P business will affect about 293 carriers in its nine-state territory, including about 100 in Georgia.

Those carriers have leased 1,972,000 consumer lines at discounted UNE-P rates and 750,000 lines to businesses, according to BellSouth.

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To see more of The Atlanta Journal-Constitution, or to subscribe to the newspaper, go to http://www.ajc.com.

(c) 2005, The Atlanta Journal-Constitution. Distributed by Knight Ridder/Tribune Business News. For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

MCIP, BLS, T,

Source: The Atlanta Journal and Constitution

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