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Largest NATA Convention and Showcase Set Stage for New Growth Opportunities.

This is the largest convention and showcase in NATA history. Over 100 manufacturers and suppliers exhibiting in 320 booths; over 20 new product introductions; and for the first time the product exhibitions of AT&T/Western Electric and GTE-Automatic Electric. We are now an industry fully established in prominence and prestige. And we are now the most important trading organization in telecommunications. New and existing products will be sold here; new distributor relations will be struck here; and new educational experiences will be enjoyed here.

No other organization in telecommunications can make these claims. But most importantly, we find ourselves where we are today because we have struggled to be here. We have courted conflict not for its joy, but because it was thrust upon us by necessity. Our willing espousal of the difficult and controversial nurtured the inventiveness and dynamics which continue to be the mainstay of our influence and strength.

One year ago we promised you renewed organization growth. Our premise was that this organization would be as dynamic in its growth as the industry it represents. From that start we have nearly doubled NATA membership, bringing it from 327 to 571 members. Joining our ranks is AT&T Information System and GTE-Automatic Electric. They come to us on a written agreement that acknowledges and accepts their legal accountability to the independent manufacturers, suppliers and distributors who make up the core of this organization and who give NATA its reason for being.

We have said to the regulated telephone industry, and to its affiliates, that we will not deny anyone the commercial and competitive benefits of membership. But we have chosen to permit their entry only on terms that reinforce the missions of NATA and of the independent distributors and manufacturers it represents. We continue to hold that regulated telephone companies and their affiliates will be called to legal account and responsibility whenever such action is required. So long as our objective is the protection and promotion of independent competition, there is no near term prospect that NATA can or will become a consensus organization. Expanding Borders

We also promised one year ago to seek out the membership and participation of companies outside our borders--those who enjoy the benefits of the US market and, therefore, must share an obligation to contribute to its preservation, and to this nation's free trade policies upon which we all depend. Because of that promise, NATA today is truly international in its scope, made up of members who include practically all the major communications equipment manufacturing firms in Wester Europe, Canada, Japan and the Far East. In recognition of our new role we are proud to announce that NATA and the Communications Industries Association of Japan have come together in exchanging honorary memberships.

In this new role, we will seek the assistance of our friends in expanding the opportunities of US manufacturers in all overseas markets as they reap the benefits of our markets. The channels of trade must be equally wide in both directions if the distribution network we have built with such difficulty is to survive in this country.

In addition to our promise of expanded membership--domestic and foreign--we also committed ourselves to deepening relationships with our own members. Consequently, in the last year we broadened our contacts with, and support of, state interconnect associations; worked arduously, but with growing frustration, to expand and improve COG operations; provided training, or support for training, in improving the delivery of network services; and established emergency installation support services during the CWA/Bell System Strike. And throughout all our endeavors we improved our publications to bring you more accurate and detailed information; and, in our new Source Book, to improve your marketing prospects with retail buyers.

The ineluctable progress of this association would have been work enough, but inasmuch as we are the interconnect industry, our work was tarnished by forces over which we had no control.

This was the year of preparation for the breakup of the Bell System. While it created new and exciting relationships for independent manufacturers, it also signaled the realization that, for us at least, not much has changed.

The court decision allowing the Bell operating companies to re-enter the terminal equipment market occasioned a precipitous decline in both the quality and quantity of COG services. Installation services supplied by the BOCs deteriorated throughout the year; and the reason does not appear to result from the dislocations one would normally expect from divestiture.

The Bell Companies also decided to get a jump on the terminal equipment market by beefing up Centrex as an equipment service. The Antitrust court said the BOCs could re-enter the communications equipment business with zero market share. But Cetrex became the vehicle for circumventing the decree. The BOCs enhanced Centrex with PBX feature services; offered it in traditional key system markets; and precipitously reduced prices to gain preferential advantages over our equipment market.

Throughout the year, as we fought these strides against independent competition, we quickly learned that regulatory and legal biases are still weighed toward carrier competition in the new environment. Once again, regulators are shutting their eyes to the cost of anticompetitive behavior to general ratepayers, as once again we persist in fighting the crosssubsidization of regulated services aimed at the competitive market.

AT&T, of course, was not to be outmaneuvered. In one of this country's more brilliant financial strokes, the Bell System's investment in used communications's equipment was written down from $9.5 to $2.8 billion. The meaning for the competitive market is that a price war will avail no one. New equipment cannot compete at the price of old, just as new cars do not compete against used ones; and it is well to remember that used car maintenance is triple or quadruple the cost of new. Unfortunately, it appears telephone customers are on the verge of relearning that same painful reality which was so well taught to them year ago by the automobile industry.

Because of these and other developments, because of destructive price competition throughout the year, there is much speculation about the survival of this industry. The speculation feeds panic and our industry is itself asking the question.

I believe you will survive--handsomely and profitably. You have a customer base from which to work, one which if attended and served will give you a continuing nucleus of business from which steady and profitable growth can be achieved.

You have service organizations which should become new profit centers within your businesses. The carrier industry in selling off its used equipment is not going to be able to maintain it with the speed of current day demands, or with the lackluster response which historically has characterized its reaction to customer service needs. They and their customers will need your help; and you will find new opportunities in specialized service markets.

So, in customer assets, marketing and service organizations you have the edge if you choose to capitalize on it. Product sales will be less important than the marketing of your company reliability, technical proficiency and service consistency.

Communications equipment sales will also be less important than the system sales you configure to serve the customer's business and work requirements. In the new environment, this industry through marketing will merge communications and computer technologies faster than the computer industry by itself would ever have dreamed possible. Computer work enhancements to communications equipment will become your niche, and will afford the competitive edge whereby you remain strong and viable. New products will give generalized computer enhancements, but it will be your work to customize the enhancements to individual customer needs.

As you grow, NATA will grow again. We will expand into representation of the computer industry because your operations will become a critically important component of that industry's success. We will also grow into a new participation with the unregulated affiliate operations of the carrier industry. But the conditions of our growth will remain the same. We will continue to stand for the protection and promotion of an independent communications equipment industry--one which is not affiliated with a regulated local exchange network through which advantages in access and price can be conferred because of regulatory prejudice and preference.

You will continue to have legal and legislative support working against government policies which are potentially adverse to your interests, and for nondiscriminatory government policies beneficial to all competitive interests. And we will strengthen our services all along the lines of importance to your business venture. We will continue to work for improvement and efficiency in the delivery of network services; and we will begin work on contingency plans to assure that future CWA strikes do not victimize all the competitive components of this industry while they exact minimal injury to the parties caught in labor disputes. New Programs

In the new year, we will begin developing seminar and educational materials for the industry; studies for the dissemination of information concerning personnel and human resources in the industry; and the promotion of educational curricula at public and private educational institutions to relieve personnel shortages in the industry.

We have come a long way. But we are not bloated by our success. The events of each day are enough to convince us of how much further we have to go; and they humble us in the conviction that no success can be built upon conceit or any sense of our own self-importance. This association, like this industry, was built on the necessity of constantly proving its value. We and you remain steadfast in the necessity of making that proof. We and you are measured by it and never forget the obligation and commitment we have to each other in meeting that measure. We wish you success as we work for it.
COPYRIGHT 1984 Nelson Publishing
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Copyright 1984 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:Spievack, E.
Publication:Communications News
Article Type:transcript
Date:Jan 1, 1984
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