Industry News

Posted: 09/1997

Industry News

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United States Telephone Association Update
Talent Hard To Find

Access Charge Reform Order Reconsideration Petition
U.S. Wholesale Long Distance Revenues Up, ATLANTIC-ACM

Bell Atlantic, MCI Link Frame Relay Services
Teltrust Prepaid Card Services For Flying J
Salutes James M. Smith

Yellow Pages Update

Invention, LightPath Form Joint Venture

United States
Telephone Association Update

WASHINGTON–The United States Telephone Association
(USTA) recently released its third competition report showing
that hundreds of local telephone markets are ready for new
competitors. Since February of this year, the number of
interconnection agreements across the nation between USTA members
and new competitors has nearly tripled. "The only thing
keeping consumers from a choice in local telephone service is the
competitions’ inability to get solid business and marketing plans
in place," said Roy Neel, president and CEO of the USTA.
"State regulators and the FCC should consider the enormous
incentive the long distance giants have to drag their feet. For
every year AT&T, MCI and Sprint stay out of the local
telephone business, they keep $10 billion in revenue."

Also, in a recent filing with the FCC, USTA said the
"expedited letter request" from the Association for
Local Telecommunications Service (ALTS) should be denied. The
letter requests a definition of information service provider
(ISP) calls as local traffic misreads the FCC’s interconnection
and access charge orders. USTA said ALTS misconstrues the FCC’s
access charge order exempting Internet traffic from access
charges. The FCC made it clear that reciprocal compensation
applies to local traffic only. USTA contends that ISP traffic is
interstate and should not be remotely considered local traffic.
Moreover, the FCC ruled in its access charge order that calls to
ISPs would be exempt from interstate access charges. This ruling
was not to be interpreted that such traffic was then considered
intrastate local traffic, according to USTA, which urged the FCC
to affirm that ISP traffic is interstate in nature and not
subject to reciprocal compensation.

Finally, USTA has suggested the FCC take immediate action to
end recent industry controversies. Neel outlined the
association’s requests:

  • The FCC needs to amend its complaint proceedings so
    individual complaints can be dealt with in a timely
  • A decision should be reached on how the costs of local
    number portability are to be recovered.
  • The FCC needs to remove the franchise fees, rights-of-way
    fees and regulatory requirements which block competition,
    diversification and the offering of new services.
  • The 44 petitions for reconsideration of the
    interconnection order should be addressed as soon as
  • Immediate action should be taken to decide how the costs
    of broadband network deployment will be allocated so
    companies can begin to comfortably invest in video

Talent Hard To Find

MCCLEAN, Va.–As today’s job market for senior managers
in high-tech positions expands, companies are finding it
increasingly difficult to fill key positions. According to
Paul-Tittle Associates Inc., the average recruitment time to
place a senior executive in a high-tech position has nearly
doubled in the last six months.

"Interestingly enough," explained Dave Tittle,
president of Paul-Tittle Associates, "our extensive research
shows that the three most important elements to attract and
retain top talent in high-tech positions are a dynamic work
environment, the potential to advance and a company commitment to
being an industry leader." Tittle suggests that companies in
the high-tech realm consider five elements before they begin a
search. First, be flexible and try not to narrow search
requirements strictly to direct competition. Second, make
incentive-based compensation the norm. Third, set company sights
on being an industry leader. Fourth, give top talent the
opportunity to grow the company. Fifth, recalibrate hiring
expectations and time frames to be consistent with today’s

"Today’s executive talent pool wants more than money,
more than ownership and more than stock options. They have a will
to build," Tittle said.

Charge Reform Order Reconsideration Petition

WASHINGTON–Several petitions have been filed with the
Federal Communications Commission (FCC) for expedited
reconsideration of the access charge reform order. America’s
Carriers Telecommunication Association (ACTA), the Competitive
Telecommunications Association (CompTel), the Telecommunications
Resellers Association (TRA) and the International Communications
Association (ICA) all filed with the FCC in order to stress their
concern that the level of competition intended by the
Telecommunications Act of 1996 was discouraged by the reform

Included in the petitions are requests to reduce the per-line
preferred inter-exchange carrier charge (PICC) levied on
interexchange carriers serving multi-line business users; to
rethink elimination of the unitary option for purchasing
tandem-switched transport; and to drive tandem switching rates to
forward-looking economic costs.

ACTA member, Mike Newkirk, president of BTI, stressed that
companies like his thrive on competition and have provided
services to the often- ignored small business community. Newkirk,
who sits on ACTA’s board of directors, claims that large carriers
were clearly favored by the FCC order.

"A $2.75 or possibly higher multi-line business PICC will
place small carriers between the proverbial `rock and a hard
place’," stated TRA executive director Ernie Kelly.
"Low volume, small-business customers will not be able to
tolerate the dramatic rate increase a `pass-through’ of the
multi-line PICC will produce, (and) small carriers have neither
the traffic volumes over which to spread the new charges without
significantly increasing rates nor the operating margins within
which to absorb those charges."

Wholesale Long Distance Revenues Up, ATLANTIC-ACM Reports

SEATTLE–Revenue from the sale of wholesale long
distance telecommunications services in the United States have
grown, and will continue to grow, faster than retail revenues as
the growth of long distance resellers continues to outpace that
of the major carriers, according to a new report by ATLANTIC-ACM.

ATLANTIC-ACM estimates that revenues from wholesale long
distance services grew at a compound annual growth rate of 23.8
percent from 1994 to 1998, jumping from $4.24 billion to nearly
$10 billion during the forecast period.

"The dramatic difference between wholesale and retail
growth rates can be attributed to much stronger growth among
resellers than among the Big Three carriers," said Dr. Judy
Reed Smith, CEO of ATLANTIC-ACM. "With the entry of the
regional Bell operating companies into in-region long distance
markets sometime in 1999 to 200, wholesale revenues should show
even stronger growth."

Atlantic, MCI Link Frame Relay Services

ARLINGTON, Va.–Bell Atlantic has announced it will
interconnect its frame relay network with MCI’s to provide
exchange access frame relay service.

The combination of the two companies’ frame relay networks
will let business and governmental customers link their local
area networks hundreds of miles apart across local access
transport areas (LATAs) and state boundaries through a
customer-dedicated, network-to-network interface. Under the
agreement, a Bell Atlantic customer can arrange for dedicated
frame relay service between any of the company’s 19 LATAs.

Exchange access frame relay service is a medium-speed,
connection- oriented, packet switched data service. It allows for
the exchange of variable length frames or packets of data. Frames
are relayed by virtual connections and travel a fixed path
through the network to each virtual connection.

Prepaid Card Services For Flying J

SALT LAKE CITY--Teltrust Inc., a wholesale
telecommunications provider, announced its wholly owned
subsidiary, Teltrust Communications Services Inc., has entered a
contract with Flying J to provide millions of minutes of prepaid
calling card services each month for more than 100 Flying J
"Travel Plazas" nationwide.

Salutes James M. Smith

WASHINGTON--James M. Smith recently announced his
intention to resign his post as president of the Competitive
Telecommunications Association (CompTel). In response to this
announcement, H. Brian Thompson, chair and CEO of CompTel, said,
"The board of directors, staff and membership of CompTel owe
Jim Smith a tremendous debt of gratitude for his dedicated and
effective service on behalf of our competitive telecommunications
industry over the past seven years.

"Jim’s leadership was most recently exemplified by his
efforts, on behalf of CompTel, to encourage the Federal
Communications Commission to examine the need for standards for
developing crucial operations support systems that are needed to
link competitive carriers to current local exchange carriers,
according to the requirement of the 1996 Telecommunications Act.

"We thank Jim for all he has done for our member
companies and for his willingness to see us through an orderly
transition, and we wish him the very best in building upon his
impressive achievements at CompTel as he moves forward to meet
new challenges and to achieve further career success."

Smith’s sudden announcement surprised industry leaders but he
was already in discussions with several firms in the private
sector and felt he owed it to the association’s board, staff and
members to reveal his intentions before they heard about it
elsewhere, according to sources.

"I’ve been with CompTel for more than seven years now and
I’m very proud of what the association has achieved in that
time," he said. "But it’s time for a change. I’ll miss
fighting the good fight from the public sector, but I’m anxious
to do the same while participating in the private

Yellow Pages Update

DENVER–The Internet publishing divisions of Ameritech,
BellSouth, Pacific Bell, and US WEST have developed a shared
Yellow Pages and information search page that will direct
inquiries to their respective Internet directories based on the
state searched.

The shared Yellow Pages search page, which the participating
companies will jointly advertise on high-traffic web sites,
features a map of the United States. Consumers just click on the
state they wish to search, and they will be connected to the
corresponding Internet yellow pages or information guide for that
area. Searches requested in states outside of those served by
these regional companies will be distributed between Ameritech
and US WEST.

LightPath Form Joint Venture

ALBUQUERQUE, N.M.–Invention Machine Corp. and
LightPath Technologies Inc. have formed a joint venture company,
LightChip Inc. to develop, manufacture and market the next
generation of wavelength division multiplexing (WDM) systems for
use by telecommunications carriers, CATV companies, local area
network and wide area network systems integrators.

LightChip’s mandate is to develop a universal design for high-
performance, low-cost WDMs that can be customized for either
long- or short-distance applications and enhanced to meet future
performance and cost requirements.

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