Government grants BellSouth approval to sell LD service

WASHINGTON, D.C. - Government regulators gave BellSouth the go-ahead Wednesday to offer long-distance service in Georgia and Louisiana. <br> <br> The decision to send a third Baby Bell into the long-distance market came only after the telecommunications company resolved regulators&#39; worries that it had done too little to stoke competition in the local phone game. <br> <br> ``Approval of BellSouth&#39;s application promises substantial benefits for the states&#39; consumers in the form of enhanced competition in both the local and long-distance markets,&#39;&#39; the Federal Communications Commission said in a statement announcing its 4-0 vote for approval. <br> <br> Atlanta-based BellSouth Corp., one of the four regional phone companies that emerged from the Bell System breakup, is the dominant local service provider in nine Southeastern states. <br> <br> In order for those Bell spinoffs to receive FCC approval to sell long-distance service, the 1996 Telecommunications Act requires them to open their local markets to competition. That means they must allow competitors, including start-ups as well as companies such as WorldCom and AT&T Corp., to pay fees to piggyback on their calling networks and show they give those companies the same level of service they provide their own retailers. <br> <br> Regulators in both states already have approved BellSouth&#39;s long-distance plan. <br> <br> BellSouth had withdrawn its previous filing in December after the Justice Department said the company had not adequately opened its local markets to competition. The application was resubmitted in February, the company&#39;s fifth since 1997. <br> <br> On Wednesday, the FCC said it determined BellSouth met the requirements. The commission warned, however, that it would be watching the company and could use enforcement tools from fines to suspending approval if it slipped. <br> <br> ``This application does not earn a grade of `A.&#39;&#39;&#39; said FCC Commissioner Michael Copps. ``In a number of areas, ... BellSouth only minimally passes the statutory checklist.&#39;&#39; <br> <br> Copps referred to competitors&#39; complaints of poor service and allegations that BellSouth has not upgraded its support operations sufficiently to allow fair competition. <br> <br> Sylvia Anderson, an AT&T vice president, called the FCC decision premature and said the key to success will be continued government oversight. <br> <br> ``Competition can still win out,&#39;&#39; she said. ``It&#39;s no sure thing, though, considering BellSouth&#39;s 90 percent market share and its well-documented history of unfairly disadvantaging competitors.&#39;&#39; <br> <br> ``The decision demonstrates a continued failure by the Commission to enforce the 1996 Telecommunications Act,&#39;&#39; said WorldCom general counsel Michael Salsbury. <br> <br> BellSouth celebrated. <br> <br> ``BellSouth is ready to be in the long-distance business,&#39;&#39; said company chief Duane Ackerman. <br> <br> The four Baby Bells still handle most of the nation&#39;s local calls. <br> <br> The FCC previously approved applications from Verizon Communications and SBC Communications to market long distance service in 11 other states. Denver-based Qwest Communications, the dominant Bell in 14 Western states, plans to seek approval. <br> <br> Ackerman said BellSouth will submit long-distance applications for its other seven states, starting within weeks. <br> <br> BellSouth shares closed up 67 cents, to $31.76, Wednesday on the New York Stock Exchange. The markets closed before the FCC announced its decision.