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Archive for Friday, April 8, 2005

SBC to seek deregulation in K.C., Topeka

Utility agency claims move would hurt consumers

April 8, 2005

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The largest phone company in Kansas wants permission to lift price controls on 47 residential and business services -- including basic service -- in the Kansas City, Topeka and Wichita metro areas.

San Antonio-based SBC Communications Inc. says it faces enough competition in the three areas to justify deregulating phone service, contending that market forces will keep consumers' bills under control.

But opponents say such a move would result in higher prices for the people least able to pay them, and possibly lead to a push for deregulating phone service in smaller areas, including Lawrence.

SBC has given the Kansas Corporation Commission notice that it would file a deregulation application by the last week of April, and possibly as early as Monday. Once it has received the application, the KCC has 51 working days to make a decision.

In 2002, a similar request from SBC, then known as Southwestern Bell, was rejected by the commission.

Under Kansas law, former monopoly companies such as SBC can petition to be freed from price regulations if they can demonstrate that local markets have become competitive.

"We believe we've been at that point for some time now," SBC spokesman Don Brown said. "It's time for customers to make that decision (selecting a telephone company) based on price, service and quality.

"The time for artificial price restraints has passed."

SBC says it competes in the Kansas City area with Sage Telecom, Everest Communications, MCI and Time Warner for residential service. In Topeka, such competitors are Sage, MCI and Prairie Stream.

The Citizens' Utility Ratepayer Board, a state agency that advocates for residential and small-business utility customers, opposes the change.

In Ohio, where most phone services were deregulated in 2002, state records show SBC raised rates on a variety of stand-alone services, while cutting the price of more expensive package deals.

"It's bad for consumers -- especially low income and elderly, who really can only afford that basic service, for which there really is no competition at all," said Steve Rarrick, a telecom attorney for CURB.

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