Sprint Corp., the long-distance giant facing increasing pressure from the Baby Bells, anticipates making a decision in the next few months concerning how the company will provide local residential service outside of its incumbent areas.
“I would expect we will make some decisions this spring, probably in the first quarter,” James Fisher, a Sprint spokesman, said Wednesday. “We are on the cusp of a decision.”
Distressed by the entry of the Baby Bells into the long-distance market, the country’s three largest long-distance carriers – AT&T Corp., WorldCom Inc.’s MCI and Sprint – have seen their market share increasingly shrink over the last few years, compelling them to combat those losses by offering local residential phone service.
AT&T and WorldCom have made aggressive inroads by reselling local phone service through the unbundled network element – platform (UNE-P), a controversial resale method the federal government is expected to phase out.
Sprint, which has local phone operations in parts of 18 states, has not expanded outside of its local territory in the residential market or disclosed a strategy to do so.
But all the country’s largest telephone companies, including Sprint, say bundling local and long-distance services, including wireless, is crucial. Verizon Communications Inc., the No. 1 local phone company, disclosed yesterday that it had surpassed Sprint as the No. 3 long-distance company, citing two surveys conducted by market research firms.
“Obviously because of the current state of long distance we think bundles are the key to selling long-distance and telecommunications services in general,” Fisher said.
Fisher said Sprint is considering the possible use of the UNE-P over the short-term. But due to expectations that the Federal Communications Commission will phase out the resale method in a few years, the phone company is discussing various ways to transition customers to another platform.
One possibility is a so-called edge-out strategy that Sprint is testing in the business market. Sprint is using its switches in its local phone territory to route calls outside of its region, and leasing the network that extends from a phone company central office to a business. Sprint plans to go head-to-head with the Bells in business markets where it traditionally has stayed away, marking its foray as a CLEC.
“That is a possibility to expand that to residential,” Fisher said.
