Senator Hollings Remarks on Bell Companies

Hollings: Bells' Empty Promises are No Surprise

Tuesday, February 25, 2003

WASHINGTON, D.C. - U.S. Senator Fritz Hollings, Ranking Democrat on the Senate Commerce, Science and Transportation Committee, released the following statement regarding the Bell Companies most recent indications that they will, once again, back away from prior commitments:

"The Bells' current backtracking on broadband deployment and their continued effort to fight FCC rules is just another chapter in a lengthy defense of their local monopoly. Just as the FCC gives them the ruling they've wanted on broadband, allowing them to deny competitors access to broadband networks, the Bells declare they're not going to invest any further.

"If we have any sense of history, we should not be surprised by empty Bell promises. For 7 years, they have consistently fought the 1996 Telecom Act in the courts and flouted it in the marketplace.

"Rather than complying with the provisions of the law, the Bells have instead racked up a total of $2.1 billion in fines for their noncompliance. As recently as October 2002, the FCC imposed the largest single fine ever on SBC for willful and repeated anti-competitive violations. And while these fines are supposed to deter bad behavior, the Bells treat them simply as the cost of doing business and pass them on to consumers in the form of higher rates.

"The result: Verizon and SBC have announced 3rd Quarter profits of $4.4 billion and $1.7 billion, respectively, and BellSouth announced yesterday that it would be increasing shareholder dividends by 5%.

"Instead of living up to their agreement to compete, the Bells continue to use every trick in the book to hold on to their local monopoly and their guaranteed profits. Before we let the Bells move the goal posts yet another time, the Administration ought to hold them accountable for the promises they make."