Pac Bell discounts local toll calls 38%; MCI, Sprint and AT&T launch huge advertising campaigns
by Vernon Keenan
One of the biggest face-offs in the California tecommunications market has just begun and the consumer who makes a lot of "local toll calls" in California is already a big winner.
The loser for now is the low-income citizen, but a battle-royale for local telephone service is due that may make every home telecom user happy.
Last year only Pacific Bell and GTE controlled "local toll calls." Now familiar long-distance telephone companies like AT&T, Sprint and MCI are permitted to provide service to California consumers.
Because of the new competitive environment, even those consumers who will "do nothing," as the Pacific Bell ads drone, will gain at least a 38% savings on their local toll calls in 1995.
Telephone consumers who choose to dial a five-digit prefix to phone calls that usually show up on their phone bill may gain even greater savings, according to AT&T, MCI and Sprint representatives.
Households and small businesses who don't make many local toll calls are paying for part of the windfall. Specifically, Pacific Bell's residential flat rates will increase $2.90 monthly, and measured service rates will rise by $1.55 monthly.
When toll rate reductions are considered, the median monthly residential customer bill will increase by 2% for Pacific Bell customers, according to the California Public Utilities Commission. These fee increases are part of a complex political and economic dance betweeen the CPUC, Pacific Bell and the long distance telephone companies. These organizations are spending millions in consumer advertising and lobbying legislatures while they compete for the California consumer telecommunications market.
With California's densely populated San Francisco and Los Angeles areas, each having at least four area codes, local toll call deregulation enabled over 100 long distance service providers to instantly gain access to a multi-billion dollar toll call market that have previously been serviced exclusively by Pacific Bell and GTE.
One possible outcome of this confusing convergence of political lobbying, advertising and regulatory ruling is that GTE and Pacific Bell may give up local access to a free market in exchange for access to the worldwide long distance market.
The only thing that's certain is that by this time next year California phone consumers will be even more confused. There should be more choices for local service, long-distance tolls and advanced telephone services.
Return to March 1st Issue Index | Return to Cyberspace Today home page