In e-commerce, GTE sees yellow

GTE filed a lawsuit last week against the five Bell regional holding companies, Netscape Corp. and Yahoo! Inc., claiming the group is attempting to monopolize the Internet Yellow Pages market.

In the suit, filed in U.S. District Court in Washington, GTE claims the five RHCs formed an illegal agreement to develop a national Internet Yellow Pages rather than compete against each other. Separately, GTE is charging that Netscape broke its contract, which called for the company to provide links to GTE's SuperPages from its Web page. Yahoo! provides the search engine for Netscape.

Before July, Netscape's site listed multiple Yellow Pages Web links, including several smaller players such as Four11 and Switchboard. However, after a series of meetings in July, Netscape's site was changed to steer users to a national map with divisions that matched the RHCs' local service territories, said Richard Stimpson, vice president and deputy general counsel for GTE. Users who click on one of the regions are linked directly to the corresponding RHC's Yellow Pages.

"They've taken major conduits into the Internet and used their economic might to, in effect, put a hurdle high enough so it's impossible to compete," said Stimpson.

With such control in the RHCs' hands, the same companies will be able to control Internet commerce and on-line Yellow Pages ad revenue, he said. "They're attempting to lock up the major in-routes to the Internet."

An Ameritech spokesman declined to comment on the lawsuit because the carrier had not yet seen it. However, he said it would be virtually impossible for any company to control Internet traffic.

A BellSouth spokesman said the company has entered into a "marketing agreement" with Netscape, Ameritech, SBC Communications and U S West (but not Bell Atlantic) that simply gives users another option for Yellow Pages service. "The Internet and World Wide Web are extremely competitive places," he said. "No one has a monopoly. If anything, we've brought more competition to the market."

GTE has asked for an expedited hearing from U.S. District Judge Harold Greene, who presided over AT&T's divestiture.