Qwest Communications International Inc. announced Thursday filing applications with the Federal Communications Commission to provide long-distance service in five states within its 14-state local region -- Colorado, Idaho, Iowa, Nebraska and North Dakota.
The Denver-based company plans to file similar applications in the nine other Western states within its local region and provide long-distance service in all 14 states by the end of the year.
The long-distance market that Qwest currently is prohibited from serving, is valued at approximately $10 billion, said Steve Davis, senior vice president of policy and law.
Critics say Qwest still has a long way to go before its networks are open to competition, and therefore should be denied permission to provide long-distance service. One trade association charged that Qwest has not met the required 14-point checklist to gain approval, saying the Bell cannot “coordinate changes in its own system with competitors.”
“Qwest has a long way to go to prove that it has truly ended their long-standing monopoly in this region,” said Sue Ashdown, executive director of the American Internet Service Provider Association, in a statement issued Thursday. “Consumers deserve the competitive telecom market intended by the passage of the 1996 Telecom Act and Qwest has fought that tooth and nail.”
Other Bell operating companies -- Verizon Communications Inc., BellSouth Corp. and SBC Communications Inc. -- that have gained entry into the long-distance market within their local regions have captured up to 30 percent of the market share since the FCC granted approval in December 1999 to the first Section 271 application.
During its first quarter earnings this year, SBC announced consumer line penetration of more than 30 percent in Arkansas, Kansas, Missouri, Texas and Oklahoma -- the states in which it offers long distance.
Qwest had to divest itself of its long-distance operations after acquiring US West in the summer of 2000. Its anticipated reentry into the long-distance market signifies a rare piece of good news for Qwest, whose stock has plummeted in the face of sluggish broadband demand, a weak economy within its 14-state region, state probes into the company’s dealings with competitors, debt concerns and credit rating agency downgrades among other things.
Qwest noted it has spent more than $3 billion to open its markets to competitors and comply with the Telecommunications Act of 1996. An independent test conducted by state regulators monitored tens of thousands of transactions in 13 states to determine the company’s ability to facilitate orders, installation, repair, billing and other services ordered by competitive telecommunications companies, Qwest noted. Arizona did not want to participate in the test, but a separate OSS test conducted in that state also showed Qwest provides service to its wholesale customers on an equal basis to the service it provides to retail customers, spokesman Bill Myers said.
