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Press Release Tuesday, January 4, 2000 |
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WASHINGTON, D.C. -- Starting today, Bell Atlantic is offering New York residential customers three new long-distance call plans that it says will save its customers 10 to 50 percent or more on most of its competitors' advertised rates.
Bell Atlantic said the plans eliminate monthly charges and confusing restrictions, which it describes as the "hidden surprises" common in other long-distance calling plans. Bell Atlantic received permission to enter the long distance market from the Federal Communications Commission on December 22.
Consumers Union (CU), the publisher of Consumer Reports magazine, says today's announcement illustrates three important trends for consumers:
· Since the Telecommunications Act of 1996 became law, long distance companies have only competed for the business of the "high-volume" users that use the telephone the most. Long distance companies have not competed for the "low-volume" users that make up over half of the consumer market. Over 50 percent of consumers - estimated to be 56 million people - are paying more today for interstate long distance than in February 1996.* This majority is comprised of people who make up to 50 minutes of long distance calls per month, and the net annual increase for them is about $2 billion.
· The Federal Communications Commission (FCC) failed to protect consumers when it refused to require long distance companies to pass cost savings of regulatory actions on to all consumers and thus prevent the new fees and charges that consumers have paid since the passage of the Telecom Act.
· Bell Atlantic deserves credit for offering New York consumers real cost savings. Since these plans are free of monthly fees and minimum charges, those who do not do a lot of long distance calling will finally begin receiving some of the benefits of competition.
Bell Atlantic's action also raises a major question: When will the telecommunications companies and regulators offer consumers nationwide the same benefits of lower prices for local phone and long distance services that New Yorkers receive? CU hopes that public officials and the telephone companies build on their success in New York and bring more competition and lower prices to consumers across the country.
*Report by CU, Consumer Federation of America, and Texas Office of Public Utility Counsel (9/22/99)
Consumers Union, Publisher of Consumer Reports magazine, is an independent nonprofit testing, educational and information organization serving only the consumers. We are a comprehensive source of unbiased advice about products and services, personal finance, health, nutrition and other consumer concerns. Since 1936, our mission has been to test products, inform the public and protect consumers.
