DOJ Gives Thumbs Down To BellSouth Long-Distance Applications

Communications Today, Nov 8, 2001

The U.S. Department of Justice's (DoJ) denial of support Tuesday for BellSouth's [BLS] bid to offer interstate long-distance telephone service in Georgia and Louisiana might not bode well for the company with respect to its related prospects at the Federal Communications Commission, an analyst said.

"I would say there is a very high probability that [the FCC] will follow the direction of the DOJ," said Erv Paw, a broadband consultant with InfoTech, a research unit of Communications Today publisher PBI Media.

Paw also said he thinks the Bell companies aren't as interested in getting into long-distance markets as they once were because the sector just isn't that profitable right now.

"I think [the 271 application process] is a strategy being played out by the Bell companies to enter the interstate broadband market without being [designated] as a dominant carrier," Paw said. "[BellSouth] might well be going through the act to camouflage what their real strategy is, and that strategy is to be prepared for broadband."

In a report to the Federal Communications Commission on Tuesday, the department said it has "serious questions" whether BellSouth's operations support systems "are adequate to support entry by competitors."

Charles A. James, assistant attorney general in the DOJ's antitrust division, said the questions concerning BellSouth's OSS "merit the careful attention of the FCC."

BellSouth spokesman Bill McCloskey told Communications Today Wednesday that the company viewed the DOJ recommendation as "being fairly positive."

"We think we are on track because we think we will be able to respond effectively to [the DOJ's] concerns," McCloskey said.

Last month, BellSouth filed applications with the FCC to offer long- distance telephone service in Georgia and Louisiana. The FCC has 90 days from the time of filing to consider BellSouth's requests.

Bell companies must pass a 14-point federal checklist proving their local networks are open to competitors before they can offer long-distance services in their home states.

--Rodney L. Pringle, rpringle@pbimedia.com >TK Talk America [TALK]: