Telecom passage

It's primarily a matter of bad timing and inaccurate perception, but AT&T's recent spate of decisions regarding customers and pricing aren't exactly making a strong case for the robustness of telecom service competition. The questions that remain are whether AT&T is trying to prove a regulatory point, or whether it's being unusually forthcoming about how it is streamlining and focusing its business.

The first instance came two weeks ago, when the Phone Company Formerly Known as Ma Bell announced that it would no longer court residential customers and would not work to retain the ones it currently has. (To put this story in context, the weekend after it broke it was the subject of the "Sunday Passage" on CBS Sunday Morning--a slot usually reserved for celebrating the lives of recently departed entertainers most people assumed were already dead.) Consumer choice advocates decried the move as a blow to competitive momentum in telecom. Older consumers nodded sagely and marked another technological and business milestone. Younger consumers texted one another on their wireless devices with messages like "what is att?"

AT&T delivered another blow earlier this week when it announced a proposal to raise rates on local service in 40 states. On the surface, the two moves combined to appear to signal a company in an all-out retreat from the business it helped pioneer--not to mention one that couldn't be working harder to push customers out of its fold--but that might just be the timing and perception part. According to several reports, AT&T's local plans are still less expensive than its competitors.

The likely answers to the questions posed earlier are that AT&T probably is indeed trying to prove a regulatory point (that the Telecom Act meant to promote local competition didn't, and won't), and that the company probably is indeed trying to be more open about its efforts to streamline, plug leaks and generally be more cost-conscious (for the sake of any interested suitors). When someone finally does decide to buy what's left of the old girl, CBS might actually bump the story all the way up to the news segment of its Sunday program.

E-mail me at jmeyers@primediabusiness.com