BellSouth seeks state OK to raise rates without oversight

<p>BellSouth has asked state regulators to give up their oversight of the company and allow North Carolina's largest provider of local telephone service to set rates and service areas without restrictions or public hearings.</p><p>The arm of the state Utilities Commission that represents consumers intends to fight BellSouth's request, which was filed Thursday.</p><p>"The lack of viable competitive alternatives to basic local service will enable BellSouth to increase the rates for those customers by forcing them into higher-priced bundled offerings or off the network completely," Robert Gruber, executive director of the commission's Public Staff, wrote in a reply to the Atlanta-based company's bid. "This is not in the public interest."</p><p>BellSouth is the first local phone-service company in North Carolina to seek freedom from all price and service quality controls. It says market competition will give customers fair pricing and reliable service.</p><p>"It would give us the opportunity to do the same thing our competitors can do _ that is, make decisions with certainty and flexibility," BellSouth spokesman Clifton Metcalf said.</p><p>The company, which serves nine Southeastern states, has won similar concessions in Alabama, Kentucky and Mississippi, Metcalf said.</p><p>BellSouth officials contend regulation is no longer needed because its 1.9 million North Carolina customers have choices that didn't exist decades ago when its services were first regulated as a monopoly.</p><p>Cable companies and wireless and Internet service providers have entered the market, BellSouth said, and none of them need state approval to raise phone prices or change calling plans. BellSouth said it has lost more than half a million land-line customers in the state over five years to competitors such as Alltel, Vonage and Time Warner.</p><p>BellSouth and other local phone providers complain their competitors underprice basic home phone service and make it up from the high revenues generated by data communications services.</p><p>Also, BellSouth, unlike its competitors, has to submit quarterly reports on problems with hookups, service and response times for repairs. It also has to meet service quality standards and respond to consumer complaints, as well as get state approval for rate changes.</p><p>Gruber said imposing a service standard on BellSouth and other local phone companies creates a statewide baseline all competitors must meet if they want to keep customers. Gruber also rejected BellSouth's arguments about the beneficial effects of competitive pressure, contending that wireless service can be spotty and Internet phones require costly broadband connections.</p><p>"Since BellSouth would no longer have carrier-of-last-resort obligations, if it did not wish to serve an existing customer, it could no longer be required to do so," Gruber wrote. "Thus, approximately one-half of North Carolina's citizens will become subject to the whims of BellSouth's management."</p><p>BellSouth has far fewer restrictions on pricing most of its data and communications services for businesses. Many pricing restrictions were relaxed last year for BellSouth, Verizon and Embarq, formerly known as Sprint.</p><p>Verizon, which has 346,000 customers in North Carolina, has no plans to ask for deregulation, but believes the move is overdue, spokesman Bob Elek said.</p><p>___</p><p>HASH(0x1cdd1a0)</p>

http://accesswdun.com/article/2006/9/117841