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CALIFORNIA PUBLIC UTILITIES COMMISSION RENDERS HISTORIC DECISION: GTE CALIFORNIA PREPARES FOR NEW RATES, COMPETITION IN EARLY 1994

 THOUSAND OAKS, Sept. 17 /PRNewswire/ -- Under a far-reaching decision today by the California Public Utilities Commission, GTE California will start 1994 with new competition and rates, including higher local service rates and lower toll rates.
 The rate rebalancing, effective Jan. 1, 1994, is GTE California's first since 1984. It will create no new revenue for the company, but will move prices of local services closer to cost, while reducing rates of short-haul toll calls by an average of about 40 percent.
 In January, long-distance companies will begin completing short-haul toll calls -- those calls beyond the local calling area -- and within any of the state's 11 LATAs (local access transport areas). Customers can continue to use GTE California to complete these calls by dialing the number, or "1" plus the number; or customers can use a long-distance company by dialing 10 and the company's three-digit code, plus the number.
 "Overall, we're satisfied with the policy direction of the commission's decision. However, we have not had the opportunity to review the order, which will contain very important details, including changes in rates," said Tim McCallion, director of revenues & earnings for GTE West Area.
 "Under today's decision, telephone service will continue to be a good bargain for Californians. For qualifying customers, uniform Lifeline rates will be available to all Californians of limited means -- $4.68 for measured service and $6.50 for flat-rate monthly service. And increased competition will benefit customers by driving the introduction of new technologies and services, as well as lowering prices."
 Based on a PUC news release, private line, special access, Centranet services, as well as FBX trunks will be open to competition, with no resale restrictions. Directory Assistance services may be offered competitively and resold. Foreign exchange services will be partially competitive, with competition for foreign exchange and transport access service within local phone service areas.
 McCallion credited the PUC for adopting most of Com. Norman Shumway's recommendations for rate rebalancing and competition.
 "We need to move local service rates closer to cost, while reducing rates for intraLATA calls," he said.
 "This will enable us to compete with the long-distance carriers for customers' short haul toll business. It will also enable us to continue to provide an intraLATA toll subsidy to local rates, that will help keep local phone service affordable," McCallion added.
 He said GTE will be better prepared to comment on today's ruling after receiving and reviewing the order -- some time next week. However, GTE's primary differences with the decision are "some PUC and GTE disagreements about price elasticity -- that is -- how much can you stimulate calling volume and revenue by reducing rates, as well as our concern with having a level playing field for competitive services. We're not asking for any new revenue, but we're concerned that some of the commission's repricing plans could leave us with a revenue shortfall," he said.
 GTE's rate for basic monthly service has been $9.75 since 1984, plus surcharges and surcredits, approved by the PUC to reflect accounting changes, costs of doing business and other PUC decisions. Since that time, extra customer charges have been eliminated for having touch-tone service and customers' local calling areas have increased 50 percent in size. Currently, the company has a 20.62 percent surcharge on local service, boosting the actual monthly rate to $11.76.
 GTE California, based in Thousand Oaks, serves 3.1 million customers in 330 communities, mostly in Southern California.
 -0- 9/17/93
 /CONTACT: Larry Cox or Dan Smith of GTE California, (24-hour News Bureau) 800-227-5556, or (outside California) 805-373-1653/


CO: GTE California ST: California IN: UTI SU:

LM-JB -- LA029 -- 3253 09/17/93 17:35 EDT
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Date:Sep 17, 1993
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