SBC's Calif. long-distance bid advances

WASHINGTON, Oct. 29 (UPI) -- The U.S. Department of Justice on Tuesday announced that it had signed off on a bid by SBC Communications Inc. to compete in California's long-distance market.

The Justice Department's decision clears the way for the Federal Communications Commission to rule on SBC's long-distance application in California.

SBC said it will file revised comments next week with the FCC. FCC commissioners are expected to reach a final decision by Dec. 19.

The government determined that SBC has "succeeded in opening its local markets in California to competition."

Based in San Antonio, SBC operates in California through its subsidiary SBC Pacific Bell.

William Daley, president of SBC, said the company has 3.7 million lines in California being served by competitors.

"California's local telecommunications market is clearly one of the most competitive in the nation," Daley said in a statement.

"We now look forward to FCC approval, which will enable us to extend the benefits of true competition to the long distance market."

Daley said "this recommendation by the DOJ sends the clear message that California's local markets are fully open and highly competitive."

The Telecommunications Act of 1996 requires dominant local telephone carriers like SBC to prove their local telephone networks in their home territory are sufficiently open to competition before they can enter long-distance markets.

California is the nation's second-largest phone market.

"The available evidence suggests that generally, SBC has succeeded in opening its local telecommunications markets in California," said Charles A. James, assistant attorney general for antitrust at the Justice Department.

"Competitors have made progress in penetrating the business markets, and the department believes there are no longer any material non-price obstacles to residential competition."

The news did little to boost SBC stock. Shares of the company lost 57 cents, or 2.27 percent, to close Tuesday at $25.25 on moderate volume of 7.3 million shares traded on the New York Stock Exchange.

SBC provides data voice and Internet services to customers in 13 states. Its subsidiaries include SBC Southwestern Bell, SBC Ameritech, SBC Pacific Bell, SBC SNET and Sterling Commerce.