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Is telecom up to
the social responsibility to get noses out of the public trough?
There are as many opinions about the Worldcom/MCI
meltdown as AT&T voiced against my Beehive Telephone Company a dozen years
ago - when I decided my telco could not make it without use-based $.47 per
minute tariffs. It's 10 times less now. Yet I'm honored every couple of
years when AT&T complains to the FCC about rates filed by the former Bell
operating companies and Beehive. I like to think AT&T gets denied
because: a) I ask for advice and do it the FCC's way, and b) I've got 40
years of training from the big guys' hammering. There is nothing like
being taken to the woodshed to understand there are serious differences of
opinion out there.
Once disputes rise above a given level, and the
lawyers take over, then rational decisions by management go out the window -
because managers are then afraid to talk. Or are hidebound and do not have
a clue. Or condone lies, as we said MCI folk did, by disputing some $ .8
mil of accumulative expenses I expected to be paid - for terminating their
traffic. MCI did not want to pay because they damn well were running out of
money. And those same guys are still working there! MCI's tactics of
discounting toll prices to less than cost, hoping volume would make up losses,
was OK, but not reporting it to stockholders was wrong.
I believe some of the procedures and bad things
Worldcom and MCI got involved in came about because managers at every level
flat-out did not know enough about the business to ride that horse.
The little stuff
Consider those who capitalized software
upgrades. It was easier to capitalize and earn than if they expensed it
with no income to offset the cost. To do it right means a rate increase.
And commissions are normally so damn picky that even small company rate changes
cost tens of thousands to process. So telcos cheat to avoid the hassle.
Whoops! Now they eat the cost. So are commissions culpable? In
many ways - sure.
Or cooperatives with fat-cat growth ideas.
Some went in debt to buy fully depreciated Bell properties. Only to find
that those price cap properties could not be changed to rate of return. Buys
were engineered by consultants. Managers sold their boards.
Commissions who should have known better approved it. Co-op debt went big time.
When boards found they were going to have to jack up the rates for their members
-all hell broke loose. Who is culpable? Everyone.
Some cooperatives created separate (non-coop)
companies for tiny former Bell areas to avoid having those higher costs merge
with the existing lower cost co-op business. And continue to slop at the trough
for dollars.
Regulators signed off on Bell company sales
because no one asked hard questions. And many commission staffs don't
comprehend. They continue to think in the glacial age to make decisions
that need answers today. Not next year or three years from now.
Today, many local exchange carriers act like
AT&T used to - by refusing EAS or provisioning of trunks or insisting on
legacy hardware and blocking toll - the continuation of which ultimately creates
an evil mindset that breeds contempt.
The FCC can't do it all, and states say the FCC
prevents them from taking some control. Free market is better than regulation,
but I question if our industry is up to the social responsibility to get noses
out of the public trough we use for self gain, to the detriment of social gain
mandated by our certificate. Next month I'll expand why, as a matter of
trust, we are granted a franchise.
Copyright 2003 by A. W. Brothers and Americas Network magazine. All rights reserved.

     
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© Beehive Telephone Co.
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