NEW CEO MUST REPAIR REGULATORY RELATIONS

Richard Notebaert's reputation for emphasizing service quality should serve Qwest Communications well in its future dealings with regulators and competitors. But the newly installed CEO likely won't have much impact on Qwest's efforts to win federal approval to provide long-distance service in its region.

Qwest earlier this month completed its 14-point checklist throughout its region and filed applications with the FCC to provide long-distance service under Section 271 of the Telecom Act in five of its 14 states — Colorado, Idaho, Iowa, Nebraska and North Dakota.

“The process is so far along, and we've done everything necessary under the law, so we're going to get in,” said Steve Davis, Qwest's senior vice president of federal policy and law. “But Dick's reputation isn't going to hurt.”

One of Notebaert's strengths is his operations background, said LaCharles Keesee, senior vice president for business and governmental affairs for competitive carrier ICG Communications. “You can believe what you hear from Notebaert in terms of his network's performance,” Keesee said. “Contrast that with other CEOs who try to achieve a good relationship by currying favor.”

While president of Ameritech, Notebaert championed the Customer First Plan, which would have opened Ameritech's network to competitors prior to the enactment of the Telecom Act.

“The Telecom Act obviated that, but Ameritech came closer than any other carrier to opening up prior to the Telecom Act,” Davis said.

Former Illinois Commerce Commission Chairman Terry Barnich, now president of Chicago-based New Paradigm Resource Group, said Notebaert had a good relationship with the ICC because he demonstrated “respect for and deference to” regulators.

“Why in the world would you offend the people with the hammers, nails and the cross? These people will crucify you if they can,” Barnich said. “I would be very surprised if Notebaert doesn't quickly ingrain the Ameritech attitude.”

Qwest's already-strained relationship with the Minnesota PUC reached a breaking point earlier this year over alleged preferential treatment provided to some CLECs.

“I don't think [former Qwest CEO Joseph Nacchio] realized the regulatory morass he was getting into,” said Kevin O'Grady, telecommunications analyst for the Minnesota PUC. “He started out sounding good but didn't really follow through on the local service side.”