AT&T to raise its rates

[SOURCE: Dallas Morning News, AUTHOR: Terry Maxon]
AT&T said Friday it plans to raise Texas rates for local telephone service about 4 percent on May 2, affecting 30 percent of its customers statewide. Consumer advocate Ed Mierzwinski of the Texas Public Interest Research Group said customers can expect more rate hikes as the phone industry consolidates. AT&T has already swallowed up regional competitors Ameritech Corp. and Pacific Telesis Group and its former parent, AT&T Corp., and has proposed acquiring another regional Bell company, BellSouth Corp. "The bigger the phone companies get as they put Ma Bell back together again, the more aggressive they will be in gouging the consumer," he said. "I am not surprised at this, and we can only expect more of the same in the future and around the country," he said. AT&T is using the authority granted it by the Texas Legislature last year to raise its rates in areas considered to be sufficiently competitive. That sweeping law, which also allowed telephone companies to get a state franchise to enter local video markets, deregulated "incumbent local exchange companies" like AT&T, formerly known as SBC Communications. Those local telephone companies as of Jan. 1 were free to set their own rates in markets of 100,000 people or more. Areas with less than 30,000 will stay regulated until Jan. 1, 2007. Also, the Public Utility Commission can deregulate markets with 30,000 to 100,000 people if those markets have at least three competitors, including at least one competitor providing local exchange telephone service, one providing telephone service over its own facilities such as a cable company and a competitor offering wireless phone service.
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