SBC Communications Inc. on Saturday announced reaching a seven-year agreement to provide wholesale phone services throughout its 13-state territory to Sage Telecom, marking the first time a regional Bell has entered a commercial pact with a rival since a federal appeals court overturned FCC rules one month ago.
San Antonio-based SBC, the second largest local phone company behind Verizon Communications Inc., said Sage will pay on average under $25 a month to lease a phone line over the life of the contract. SBC also said the agreement contains provisions relating to data and Internet services.
“This proves that when two companies are sincere about negotiating terms that are mutually acceptable, it can be done quickly and smoothly,” SBC CEO Ed Whitacre, Jr. said.
FCC commissioners last week called on telecommunications providers to negotiate commercial agreements with the four regional Bells to set rates for leasing their networks.
On March 2, the U.S. Court of Appeals for the District of Columbia Circuit overturned FCC rules, declaring the regulator did not have the right to designate rulemaking authority to state public service commissions. The court also rejected a national finding that phone companies such as AT&T Corp. and Sage are impaired without being allowed to lease Bell switches at government-mandated rates.
The Office of the Solicitor General within the Justice Department may seek an appeal before the Supreme Court.
