Senator Warren Limmer Calls for Local Telephone Competition; Qwest Must Split Its Wholesale and Retail Businesses

Apr 24, 2001, 01:00 ET from Senator Warren Limmer

    ST. PAUL, Minn., April 24 /PRNewswire Interactive News Release/ -- In an
 effort to open the Minnesota local telephone market up to competition, Senator
 Warren Limmer (R-Maple Grove) today introduced a "structural separation" bill
 that would require Minnesota's largest incumbent phone company, Qwest
 (NYSE:   Q), to separate its retail and wholesale operations.  Under the
 legislation, Qwest would be required to separate the retail business that
 serves residential and business customers directly from the wholesale business
 that serves other telephone companies.  Limmer announced the bill at a press
 conference at the Minnesota state capitol.
     "The vast majority of Minnesotans today still do not have a choice of
 local phone companies," said Limmer, "even though the US Telecom Act was
 passed five years ago to allow competition.  As we see the fall of more and
 more competitive local service competitors across the country, we must realize
 that consumers will not see competition any time soon unless we act.  The
 monopolies of the Baby Bells, including Qwest, are well intact."
     Limmer continued, "Minnesotans deserve a choice in local phone
 competition.  They deserve lower prices, more service options, and better
 customer service.  But so far, companies such as Qwest have done more talking
 about welcoming competition than acting.  The problem, I now see, is that
 Qwest has an inherent conflict of interest."
     The goal of the structural separation bill is to introduce competition
 into local telephone service so that prices will drop and service will
 improve.  The bill will ensure a competitive local exchange market by
 preventing Qwest's wholesale affiliate from discriminating in favor of its
 retail affiliate at the expense of other competitors for local service.
 Specifically, the bill calls for Qwest to create separate wholesale and retail
 affiliates.
     Under the legislation, Qwest's retail affiliate would be required to
 operate as a competitive local exchange carrier (CLEC).  Its retail and
 wholesale arms would maintain separate locations, books, records and accounts
 and have a separate leadership and employee base.
     Qwest's wholesale unit would own and operate all network facilities and
 would be prohibited from providing retail service.  It would not be allowed to
 discriminate in favor of the retail unit, and vice versa.  And finally, the
 PUC would have the authority to approve transactions between the affiliates,
 as well as provide standards of conduct with penalties for violations of
 conduct.
     AT&T (NYSE:   T), one of the bill's strongest supporters, contends that
 "Consumers will be freed of Qwest's monopoly and get a real choice in local
 phone service only when competitors have an equal opportunity to compete with
 Qwest."
     "This bill gives competition a chance," said Teresa Lynch, AT&T Law and
 Government Affairs assistant vice president in Minnesota.  "Qwest's wholesale
 and retail services cannot coexist peacefully -- they must be separated."
     Lynch continued, "AT&T has been trying and will continue to try and break
 into the local phone market.  But we continue running into roadblocks put up
 by Qwest.  Most recently, Qwest refused to run a test with AT&T to make sure
 our operating systems can work together, a step critical to compete.  So we
 had to file a complaint with the Minnesota PUC, wasting both time and money.
 Structural separation is the only solution. "
     Tom Pelto, AT&T's Law and Government Affairs vice president in AT&T's
 Western Region, said "The Telecom Act was necessary, but not sufficient.
 Structural separation is stiff stuff, but in this case, cosmetic surgery will
 not do.  Unless consumers want worse service at a higher price, we must have
 the conviction and courage to reverse this trend."
     "Qwest is the common denominator," Pelto continued.  "Therefore, this
 legislation deals with means, motive and opportunity.  Competition, choice and
 consumers require drastic action and we applaud Senator Limmer's willingness
 to make this stand for Minnesotans."
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X37698285
 
 

SOURCE Senator Warren Limmer
    ST. PAUL, Minn., April 24 /PRNewswire Interactive News Release/ -- In an
 effort to open the Minnesota local telephone market up to competition, Senator
 Warren Limmer (R-Maple Grove) today introduced a "structural separation" bill
 that would require Minnesota's largest incumbent phone company, Qwest
 (NYSE:   Q), to separate its retail and wholesale operations.  Under the
 legislation, Qwest would be required to separate the retail business that
 serves residential and business customers directly from the wholesale business
 that serves other telephone companies.  Limmer announced the bill at a press
 conference at the Minnesota state capitol.
     "The vast majority of Minnesotans today still do not have a choice of
 local phone companies," said Limmer, "even though the US Telecom Act was
 passed five years ago to allow competition.  As we see the fall of more and
 more competitive local service competitors across the country, we must realize
 that consumers will not see competition any time soon unless we act.  The
 monopolies of the Baby Bells, including Qwest, are well intact."
     Limmer continued, "Minnesotans deserve a choice in local phone
 competition.  They deserve lower prices, more service options, and better
 customer service.  But so far, companies such as Qwest have done more talking
 about welcoming competition than acting.  The problem, I now see, is that
 Qwest has an inherent conflict of interest."
     The goal of the structural separation bill is to introduce competition
 into local telephone service so that prices will drop and service will
 improve.  The bill will ensure a competitive local exchange market by
 preventing Qwest's wholesale affiliate from discriminating in favor of its
 retail affiliate at the expense of other competitors for local service.
 Specifically, the bill calls for Qwest to create separate wholesale and retail
 affiliates.
     Under the legislation, Qwest's retail affiliate would be required to
 operate as a competitive local exchange carrier (CLEC).  Its retail and
 wholesale arms would maintain separate locations, books, records and accounts
 and have a separate leadership and employee base.
     Qwest's wholesale unit would own and operate all network facilities and
 would be prohibited from providing retail service.  It would not be allowed to
 discriminate in favor of the retail unit, and vice versa.  And finally, the
 PUC would have the authority to approve transactions between the affiliates,
 as well as provide standards of conduct with penalties for violations of
 conduct.
     AT&T (NYSE:   T), one of the bill's strongest supporters, contends that
 "Consumers will be freed of Qwest's monopoly and get a real choice in local
 phone service only when competitors have an equal opportunity to compete with
 Qwest."
     "This bill gives competition a chance," said Teresa Lynch, AT&T Law and
 Government Affairs assistant vice president in Minnesota.  "Qwest's wholesale
 and retail services cannot coexist peacefully -- they must be separated."
     Lynch continued, "AT&T has been trying and will continue to try and break
 into the local phone market.  But we continue running into roadblocks put up
 by Qwest.  Most recently, Qwest refused to run a test with AT&T to make sure
 our operating systems can work together, a step critical to compete.  So we
 had to file a complaint with the Minnesota PUC, wasting both time and money.
 Structural separation is the only solution. "
     Tom Pelto, AT&T's Law and Government Affairs vice president in AT&T's
 Western Region, said "The Telecom Act was necessary, but not sufficient.
 Structural separation is stiff stuff, but in this case, cosmetic surgery will
 not do.  Unless consumers want worse service at a higher price, we must have
 the conviction and courage to reverse this trend."
     "Qwest is the common denominator," Pelto continued.  "Therefore, this
 legislation deals with means, motive and opportunity.  Competition, choice and
 consumers require drastic action and we applaud Senator Limmer's willingness
 to make this stand for Minnesotans."
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X37698285
 
 SOURCE  Senator Warren Limmer

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