News

Ohio Delays Hearing on SBC-Ameritech Merger

12/06/1998 7:00 PM Eastern

Ohio regulators will delay a hearing on SBC Communications
Inc.'s $64 billion acquisition of Ameritech Corp. to give opponents time to prepare their
game plans.

At the request of several interveners in the case,
including the state's cable-television operators, the Public Utilities Commission of Ohio
agreed two weeks ago to push back a hearing that was originally scheduled for next week
until Jan. 5.

Among those requesting the delay was the Ohio Cable
Telecommunications Association, which accused the telcos of dragging their feet in
responding to the industry's discovery requests.

"I think that there's been some 'gaming' of the
process," OCTA executive vice president Ed Kozelek said. "We've had some
problems getting our discovery requests adequately addressed."

Other interveners with ties to the cable industry include
Time Warner Cable, the state's dominant MSO, and Time Warner Telecom, a competitive
telephone-service provider serving businesses in Columbus and Cincinnati.

Time Warner Cable opposes the transaction on the grounds
that the combined companies would exert enough additional power over the Ohio market to
steer consumers toward their unregulated offerings, including video service delivered by
Ameritech New Media.

Time Warner Telecom, meanwhile, is afraid that the deal
might adversely impact existing agreements that allow it to serve customers in Ohio.

Joining the OCTA in asking for the delay was the Ohio
Consumers Counsel, a state consumer-watchdog group, which also wants additional
information from the regional Bell operating companies before it decides whether to
officially oppose the merger.

"We're interested in local competition, or choice, for
residential phone service," OCC spokeswoman Susan Merryman said. "But we also
want to know the effects on competition of bring two large companies like this
together."

Ameritech spokeswoman Kim Norris said the delay would not
be "detrimental" to the merger, adding that the companies had provided 26,000
pages of documentation for review.

"The bottom line is that the process is moving ahead,
and that it ultimately will be good for consumers," Norris said.

A highlight of the upcoming hearing will be a recent PUCO
staff report that found that SBC's and Ameritech's application for commission approval of
their deal had not demonstrated how the public would benefit from the transaction.

The report agreed with opponents of the merger in arguing
that SBC and Ameritech could concentrate on promoting unregulated offerings in Ohio,
thereby resulting in a dropoff in the quality of telephone service in the state.

Both companies have promised to provide expert testimony
supporting their position during the upcoming hearing.

PUCO officials tried to downplay the delay.

"This happens all of the time," commission
spokesman Dick Kimmins said, "especially in a big case. And this one is being closely
watched by the telecommunications industry."

Want to read more stories like this?
Get our Free Newsletter Here!
September
October

VR 20/20

The Times Center, New York, NY