BTNA Opposes Sprint's "Anticompetitive Alliance".

NEW YORK--(BUSINESS WIRE)--Nov. 21, 1994--Citing "very serious public interest concerns," BT North America Inc. (BTNA) has called upon the Federal Communications Commission (FCC) to refrain from approving the proposed alliance between Sprint, France Telecom (FT) and Deutsche Telekom (DT) until substantial changes have occurred in the French and German telecommunications markets and regulatory regimes.

BTNA's comments underscore the fact that both FT and DT enjoy monopolies on telecommunications infrastructure and public switched voice telephone services and that these monopolies will be government-protected until 1998 and may exist in a de facto sense much longer.

"In contrast to the UK, which the commission described as `one of the most liberalized markets in the world,' the markets in France and Germany are effectively closed," said James E. Graf, President of BT North America. "Further, the regulatory regimes in these countries do not adequately protect competitors against anticompetitive discrimination and cross-subsidization.

"In particular, there is no comprehensive and enforceable regulatory regime which would ensure prompt, fair and reasonable connection to the telephone infrastructure," Mr. Graf said.

"If the same public interest standards applied by the FCC to the BT-MCI alliance are applied to the Sprint deal," Mr. Graf added, "the commission must conclude that safeguards and reporting conditions are insufficient to protect the public interest and eliminate the anticompetitive discrimination inherent in the Sprint/DT/FT transaction."

BTNA's comments urge that the Sprint deal not be approved until:

o FT and DT are privatized at least to the extent that they derive a

substantial portion of their capital from private markets and not

from public treasuries

o The French and German markets are liberalized and become open to

facilities-based entry by competing (international) ventures

o France and Germany establish a comprehensive and enforceable cost

accounting and interconnection regime

o FT and DT are each regulated by an organization that is fully

separate from the telecommunications operator and politically

independent from the ministry which manages whatever remains of the

respective government's stock investment in FT and DT after

privatization

o There is adequate assurance that FT and DT will not be able to

discriminate in favor of their Sprint joint venture to the detriment

of third parties

With annual revenues of $20 billion, BT is the world's fourth largest telecommunications company, employing approximately 156,000 people in 100 offices and 30 countries around the globe. The company's principal business is providing long distance and international telecommunications services in the U.K., serving 26 million access lines. The company also has major commitments in other advanced business communications services.

CONTACT: BT North America

             Jim Barron
             212/418-7860