SBC Enters Texas Long-Distance Arena

SAN ANTONIO (07/07/2000) - SBC Communications Inc. today becomes the second regional Bell operating company to begin long-distance service in its home state. However, prospects for a nationwide wave of RBOC long-distance offers remain remote until next year.

On June 30 the U.S. Federal Communications Commission approved SBC's application to offer long-distance service in Texas. SBC subsequently set July 10 as the date it will begin service under its new Southwestern Bell Long Distance brand name.

Last week SBC revealed its new long distance service rates that range from 6 to 9 cents per minute for consumers and 4.2 to 14 cents per minute for business users. Yet corporate users in Texas are unlikely to rush to renegotiate their long-distance contracts. When Bell Atlantic Corp. became the first RBOC to win long-distance approval - for its home state of New York - it began with a straight voice offer and waited months before fleshing out a private line, frame relay and ATM service suite.

SBC officials say that data and long-distance voice service bundles are available to business users, but pricing details were not available at press time. SBC is also targeting the state's Hispanic and Asian populations for services that include the lucrative international calling market.

By coincidence, SBC's Texas approval came the same day US West Inc. completed its merger with broadband upstart Qwest Communications International Inc., which has promised to push US West to get long-distance authority faster than it would on its own.

But Qwest President Joe Nacchio last week said the combined company - now known in its entirety as Qwest - won't apply for longdistance authority until it installs a new release of back-office software due in December. Both the New York and Texas approvals have centered around independent tests of RBOC systems that enable local competitors to submit orders electronically.

Indeed, the FCC's approval of SBC's Texas application came after much debate over SBC's own provisioning systems. "This approval did not come easily," said FCC Chairman William Kennard in a statement. Kennard said he had challenged SBC to improve its methods of unbundling local loops and electronically linking to local competitors' ordering systems. He said SBC had "responded in full" to those challenges.

AT&T Corp. wasn't so sure. In a statement, AT&T charged that a number of "serious concerns" about SBC's systems remain unresolved, adding that it was leaving open its options to decide "what further steps may be appropriate."

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