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BELL COMPANIES SHOW RESTRICTIONS COSTING AMERICAN JOBS; DENYING CONSUMERS MASSIVE SAVINGS

 Analysis projects 3.6 million new jobs;
 Nearly $630 billion in savings by 2003
 WASHINGTON, July 21 /PRNewswire/ -- Unfettered competition in the telecommunications, cable and information services businesses would result in 3.6 million new jobs and nearly $630 billion in savings on consumers' phone and cable bills by 2003, according to dramatic new evidence presented today by America's Bell telephone companies.
 These economic benefits will occur when consumers have the widest possible choice of Information Age communications products and services. "Today's technology can increase the options available to consumers and dramatically affect the U.S. economy," said William C. Ferguson, chairman and CEO of NYNEX.
 These stunning economic gains would result if the Bell companies were allowed to offer long-distance telephone service, manufacture telecommunications equipment, remain in the information services business and provide cable TV programming, according to an econometric model, created by the prestigious WEFA Group, and released at a Capitol Hill press conference earlier today.
 "These numbers are so compelling that there can be only one message to the Congress," said Ferguson. "If the economy is the problem, lifting these restrictions could be a huge part of the solution."
 This model compares favorably to the Clinton administration's efforts to create 500,000 jobs over five years. "The Clinton/Gore administration recognizes the importance of an advanced information infrastructure for America's future," Ferguson explained. "In `Technology for America's Economic Growth,' the Clinton/Gore administration noted: `Accelerating the introduction of an efficient, high-speed communication network and associated computer systems would have a dramatic impact on every aspect of our lives. But this is possible only if we adopt forward-looking policies that promote the development of new technologies and if we invest in the information infrastructure needed for the 21st Century.'"
 "The analysis we're announcing today confirms what we've been saying all along -- that letting the Bell companies compete fully in the telecommunications marketplace is good for the industry, good for consumers and good for America," Ferguson said.
 "It's time," Ferguson continued, "to lift the ban on telco provision of video programming, time to lift the ban on Bell provision of long- distance services, and time to end the wasteful ban on Bell manufacturing of telecommunications equipment. It's time to act to put American consumers' interests first."
 The telco video programming ban is part of the 1984 Cable Act. The other restrictions on Bell company participation in lines of business that would be natural for them were contained in the 1984 court decree - - known as the Modification of Final Judgment (MFJ) -- that created the seven Bell Holding Companies.
 Based on widely respected economic models, the WEFA analysis found that competition resulting from line-of-business relief would bring these results:
 -- Long-distance toll rates would fall 50 percent from Baseline,
 saving customers over $490 billion over the next decade.
 -- Cellular rates would fa 15 percent from Baseline over the first
 five years following relief, saving more than $25 billion by
 2003.
 -- Local rates would increase less than one-half their Baseline
 projected amounts, saving consumers more than $30 billion over
 the same period.
 -- Cable prices would decrease almost 25 perce nt rom WEFA's
 Baseline forecast for the ten-year period, saving consumers
 nearly $75 billion by 2003.
 Based on their assumptions, which they believe to be conservative, WEFA experts conclude that lower rates over the 10-year forecast period will result in savings to residential and business customers of $630 billion by 2003, averaging $63 billion per year.
 "The jobs picture is just as exciting," said Morton Bahr, president of the Communications Workers of America, which represents 600,000 workers at AT&T, Bell companies and other telecommunications firms.
 "Jobs, well-paying jobs, are key to stimulating the kind of growth in the economy that will help our members prosper," Bahr said. "These jobs will spread throughout the economy, employing more workers in many sectors, snowballing to create more demand for telecommunications and more jobs for communications workers.
 "I realize these 3.6 million new jobs won't all be union jobs, but let's get these jobs created, then let me worry about organizing the workers," Bahr said. "For now, these numbers make it very clear that, to use Mr. Ferguson's words, `It's time,' time to remove these outdated restrictions and let American workers prosper."
 "Lower prices for products and services that result from cuts in phone and cable charges should lower the Consumer Price Index by nearly one full percentage point, and that, in turn should leave long-term interest rates more than a full point lower by 2003 than they would be in the WEFA Baseline forecast," said Michael Raimondi, senior vice president, The WEFA Group. The Baseline forecast assumes no relief from MFJ or cable restrictions for the Bell companies.
 Explaining the compounding effect on the economy of these dramatic changes, Raimondi said, "The combination of lower prices and lower interest rates, and increased productivity from greater use of telecommunications and related information technologies for services such as health care, will increase real growth in Gross Domestic Product (GDP) from a baseline prediction of 2.95 percent to approximately 3.3 percent a year."
 In addition, the WEFA analysis shows that complete lifting of the line-of-business restrictions should:
 -- Raise real consumer spending by about $137 billion by 2003.
 -- Raise total business investment $72 billion.
 Achieving these benefits is predicated on two critical requirements, the report emphasizes. First, the line-of-business restrictions are removed immediately; and, second, corresponding changes are made to federal and state regulatory policies that enable all telecommunications providers, including the Bell companies, to compete under equivalent terms and conditions.
 Conducted by The WEFA Group, a leading international econometric consulting firm, with headquarters in Bala Cynwyd, Pa., and Burlington, Mass., the analysis was designed to estimate and forecast the direct and indirect employment changes in the U.S. economy due to Bell company participation in lines of business from which they are currently barred. The WEFA Group was formed through the 1987 merger of two leading international econometric consulting firms, Wharton Econometric Forecasting Associates and Chase Econometrics.
 -0- 7/21/93
 /NOTE: Reporters may obtain copies of the 92-page analysis by contacting Tammy Yates at 202-973-5300./
 /CONTACTS: Bill Newman of The WEFA Group, 202-973-5320; Bill


McCloskey of BellSouth, 202-463-4129; Peter Lincoln of Ameritech, 202-955-3058; Melissa Andrews of Bell Atlantic, 703-974-1479; Bob Jasinski of NYNEX, 202-336-7825; Janice Rylander of Pacific Telesis Group, 202-383-6431; Joyce Taylor of Southwestern Bell Corp., 202-293-8553; or Mary Hisley of U S WEST, 202-429-3105/
 (BLS NYN)


CO: The WEFA Group; BellSouth; The WEFA Group ST: District of Columbia IN: TLS SU: ECO

IH-DC -- DC014 -- 3931 07/21/93 12:14 EDT
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Date:Jul 21, 1993
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