AT&T seeks BellSouth separation

(Telephony) AT&T filed a petition yesterday with the Florida Public Service Commission seeking BellSouth’s separation into retail and wholesale units to bolster local telephone competition in the state.

The long-distance giant claimed BellSouth’s 93% hold on Florida’s local market stifles competition and provides no incentive to cooperate with competitors.

“Any incentive BellSouth has to fulfill its legal obligations to open its network to competitors is outweighed by a much stronger incentive to hold on to its local monopoly,” AT&T said in a statement.

BellSouth responded that competition is strong throughout the state, particularly in the lucrative business segment, where competitors claim 20% of the market.

“In a marketplace where 20% of the customers provide 80% of the revenues, the 93% [of the local phone market] is disproportionate from what the revenue impact actually is,” a BellSouth spokesman said.

In its statement, AT&T alleged that BellSouth charges anticompetitive prices to customers and provides inferior service to competitors in Florida

But a BellSouth spokesman said the cost of providing local telephone service often exceeds the cost to customers. The spokesman cited Miami as an example, where he said BellSouth’s cost to provide local service is $21.80, while it charges $10.81.

Moreover, he said that state regulatory bodies establish local phone prices, not the company.