[comp.dcom.telecom] PacTelesis Power Grab

ktl@wag240.caltech.edu (Kian-Tat Lim) (12/06/89)

	Pacific Telesis ran a full-page ad in today's Los Angeles
Times.  Here's the text (there is no copyright on the ad):

[Big headline]	Can you imagine living in a country that limits the
		flow of information to its students?

[Big headline]	You do.

[Bold italic] If Naason Sanchez lived in Great Britain, his telephone
line could connect him to a computerized information service that
would help him learn to solve math problems and answer geography
questions in an instant.  But Naason lives in Los Angeles, California
 -- in the United States of America -- and he isn't that lucky.

	Here in America, the Bell telephone companies aren't allowed
to work closely with educators to create and offer information
services like these that can help students learn.  Or for that matter,
provide many other services that could improve the lives of American
citizens in ways people in other countries take for granted.  Nor are
the Bell companies allowed to design and produce equipment which could
make these services easier to use.

[Headline]	Why is the U.S. behind?

	In 1984, an agreement between AT&T and the U.S. Justice
Department split up the nationwide Bell system, forming Pacific
Telesis and six other regional holding companies.  At that time, very
narrow limits were imposed on the services that their phone company
subsidiaries, like Pacific Bell, could offer.

	Today, students in many other countries can use their phone
systems to reach special computerized tutoring services, or they can
access data bases that can help them do the research necessary to
complete their homework assignments.

	Meanwhile, here in America, it's a different story.  These
services are available, but only in limited locations, and at high
cost.  If the Bell companies could develop and provide these services,
along with many others that people in other countries take for
granted, they would become more widely available, and growth of this
market would encourage more information providers to enter it.

[Headline]	There _is_ something you can do.

	Legislation that would lift restrictions on Pacific Bell has
already been introduced in the U.S. Congress.  But it's not too late
for you to learn more about this issue, and help us do something about
it.
	The education of Naason Sanchez and millions of other American
kids is too important to put on hold.

[Boxed]		STOP PUTTING AMERICA ON HOLD
[Logo of telephone handset with a pair of hands]
For further information, call Pacific Telesis Group.
1-800-776-1636.

[My comments:

1.	I sincerely doubt that Pacific Telesis expects to make much
money off of education-only information services.  I would expect them
to quickly take a back seat to more lucrative commercial services.

2.	How many countries have telco-owned information services?
Britain, France, and who else?

3.	Lifting restrictions may be a bit more general than the ad
implies.  I plan to call to get the further information.

4.	[Not telecom related] Is answering geography questions
instantly, by reference to a computer database, really a good way to
improve our educational system?


Kian-Tat Lim (ktl@wagvax.caltech.edu, KTL @ CITCHEM.BITNET, GEnie: K.LIM1)

john@bovine.ati.com (John Higdon) (12/10/89)

Kian-Tat Lim <ktl@wag240.caltech.edu> writes:

> 	Pacific Telesis ran a full-page ad in today's Los Angeles
> Times.  Here's the text (there is no copyright on the ad):
> [...]
> 	In 1984, an agreement between AT&T and the U.S. Justice
> Department split up the nationwide Bell system, forming Pacific
> Telesis and six other regional holding companies.  At that time, very
> narrow limits were imposed on the services that their phone company
> subsidiaries, like Pacific Bell, could offer.

And for good reason. This was the topic of a meeting at the State
building in San Francisco a couple of months ago between PacTelesis,
information providers, and a rep from the PUC. A lot was discussed,
but the long and the short of it is that since Pac*Bell controls the
network, they could and probably would use every trick in the book to
unfairly compete with independent providers. Once they gained a
monopoly (in a completely unregulated market), they would only
concentrate on lucrative aspects of the service. Since the PUC is not
really sympathetic to Pac*Bell on this issue, it appears that they
have taken to the streets.

To see how information services provided by Pac*Bell would evolve,
just look at the nation's cable TV industry. Cable companies scrambled
to get exclusive franchises in cities across the US, promising to
offer, not only TV stations from all over, but interactive services,
educational services, and cultural programming. What did we really
get? With minor exceptions, there is no interactive capability, they
dropped the "out of area" TV stations and substituted all manor of
over-priced pop-market pay channels.  There are shopping channels,
pay-per-view channels, and the rates have gone through the roof, even
though technology and economies of scale would contraindicate the
present high cost to the consumer.

> If the Bell companies could develop and provide these services,
> along with many others that people in other countries take for
> granted, they would become more widely available, and growth of this
> market would encourage more information providers to enter it.

This is blatant nonsense. If the market is so promising, why aren't
entreprenuers falling all over themselves to enter it now, as they are
perfectly able to do? Is the reasoning that just because a "Bell
company" enters a market that a stamp of approval has been issued?

> 1.	I sincerely doubt that Pacific Telesis expects to make much
> money off of education-only information services.  I would expect them
> to quickly take a back seat to more lucrative commercial services.

Absolutely correct. See my comments above about cable TV to see how
there motives line up with reality.

> 3.	Lifting restrictions may be a bit more general than the ad
> implies.  I plan to call to get the further information.

There is only one thing to remember: PacTelesis' dream is to become an
"unregulated monopoly".


        John Higdon         |   P. O. Box 7648   |   +1 408 723 1395
    john@bovine.ati.com     | San Jose, CA 95150 |       M o o !

langz@asylum.sf.ca.us (Lang Zerner) (12/14/89)

In article <1863@accuvax.nwu.edu> ktl@wag240.caltech.edu (Kian-Tat Lim) writes:
>X-Telecom-Digest: Volume 9, Issue 555, message 2 of 5

>	Pacific Telesis ran a full-page ad in today's Los Angeles
>Times.  Here's the text (there is no copyright on the ad):

For the future reference of all posters, the United States has joined
the Berne International Copyright Convention, which means that the
text is copyright by default, even if not explicitly stated.  I doubt
PacTel would be too upset about this message getting spread 'round,
but forewarned is forearmed.

Be seeing you...

Lang Zerner
langz@asylum.sf.ca.us   UUCP:bionet!asylum!langz   ARPA:langz@athena.mit.edu
"...and every morning we had to go and LICK the road clean with our TONGUES!"


[Moderator's Note: The only one I have trouble with here is Dow Jones
and Company / The Wall Street Journal. Those people have screamed a
couple times about stuff 'reprinted without permission' on the net in
one news group or another. Other papers seem to like us discussing their
articles. But Mr. Zerner's point is a good one worth remembering.  PT]

goldstein@delni.enet.dec.com (12/15/89)

In article <1863@accuvax.nwu.edu>, ktl@wag240.caltech.edu (Kian-Tat Lim) 
writes...
 
>	Pacific Telesis ran a full-page ad in today's Los Angeles
>Times.  Here's the text (there is no copyright on the ad):
 
>[Big headline]	Can you imagine living in a country that limits the
>		flow of information to its students?
 
>[Big headline]	You do....
>[Headline]	Why is the U.S. behind?
 
>	In 1984, an agreement between AT&T and the U.S. Justice
>Department split up the nationwide Bell system, forming Pacific
>Telesis and six other regional holding companies.  At that time, very
>narrow limits were imposed on the services that their phone company
>subsidiaries, like Pacific Bell, could offer.

Cute.  PacTel is simply doing the usual pressure-job on the courts.

Under the judicially-imposed regulations (i.e., the consent decree's a
settlement to an antitrust suit, and implies previous guilt), "Bell"
companies are allowed to have monopolies on local telephone service,
but are not allowed to manufacture or own information providers.  They
have to buy their goods from the free market (what's that, they
wonder?).

Indeed Naason Sanches is allowed to have information services,
available by phone.  What PacTel isn't allowed to do is sell the
information.  They can sell the access to third parties who provide
the information.  But Bells are common carriers, who carry information
for a price, and not information providers.  The court has ruled, in
effect, that if they were to be both, they'd have too much clout to
compete with other information providers.  If they really guaranteed
fairness, they'd probably be given more leeway.  (The FCC has relaxed
its rules, but the court is now the limiting factor.)

It takes time for a monopoly to learn to compete fairly.

      fred

Disclaimer:  I speak for me.  Opinions are mine alone; sharing requires 
permission.