1983-07-20 Public Hearings and Regular Meeting

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0 Dallas Morntg News 7/3/83 • AT&T split promises C� 0 telephone ., By Jackie Calmes Austin Bureau of The News AUSTIN — Next Jan. 1, after a night of New Year's revelry, most Americans will awake to the begin- ning of a revolution and the end of the world as phone users know it. Jan. 1 is the effective date, after two years of preparation, of a court - approved settlement of the U.S. Jus- tice Department antitrust suit against American Telephone & Telegraph Co. Fifty years of low- cost phone service, which Bell pro- vided in exchange for monopoly status, will come to an end. Texans received a preview of the coming age last month,, when Southwestern Bell Telephone Co. filed a request for $1.7 billion in in- creased revenues — the largest su:n ever sought by a U.S. utility company. If the request were approved by the Public Utility Commission, which has six months to decide the historic case, local phone line rates would triple. The benefits, Bell offi- cials predict, would be lower long- distance rates that might offset lo- cal -rate increases for customers who make many long-distance calls, a wider choice of phone equipment and a technology race among AT&T and its competitors that probably would reshape Amer- ican business. - The Texas case has its roots in the 1974 Justice Department deci- sion to sue AT&T for antitrust vio- lations. For seven years, AT&T fought back. Finally, in January 1982, the company and the govern- ment announced a pact to make the industry competitive. The details of divestiture, after 18 months, are nearly complete. But when experts met in San Fran-- cisco recently to discuss "The New Telecommunications Market- place," one thing was clear: No one was sure what the results will be: Joseph Fogarty of the Federal Communications Commission com- plained that "the Justice Depart - went pursued: competition for com- petition's sake - without any re- gard for the ultimate effect on ratepayers." But Forgarty said the FCC shares some blame. "We had no battle plan. We had no strategy whatsoever," Fogarty said. "It was piecemeal. There was nobody planning in Washington for the ultimate impact." The Dallas Morning News: Sharon Roberts But Ronald G. Carr, a former Justice Department attorney in the antitrust case, said he "never doubted it would be good public policy to break up AT&T." After Jan. 1, AT&T will shed all but about $40 billion of an esti- mated k55 billion in assets. The still -gigantic company will have five parts: the Long Lines division for long-distance service, Bell Labs and Western Electric for inventing and manufacturing equipment, AT&T International for foreign op. erations and the new American Bell, or "Baby Bell," to market