Second Section
UNIVERSITY DAILY KANSAN / MONDAY, DECEMBER 12, 1988
Baby Bells survive alone Despite predictions, competition a success
The Associated Press
WASHINGTON — As part of the AT&T breakup, the Baby Bell telephone companies were given the lucrative Yellow Pages business because it was feared they would be unable to survive apart from their parent.
As it turns out five years later, those fears were unfounded.
The seven Baby Bells, which carved up American Telephone & Telegraph Co.'s local operating networks, are among the nation's corporate giants with assets ranging from $19 billion to $27 billion and investments in a variety of domestic and international businesses.
a variety of domestic and foreign sites. In fact, directory publishing has become such a good money-maker that many of the Bells have removed Yellow Pages from the regulated side of their businesses and now use those profits to support other competitive ventures.
"They came out of the blocks faster than anyone anticipated," said Robert Morris III, a San Francisco-based telecommunicating analyst with Goldman, Sachs & Co.
c. Here, at a glance, are the seven Baby Bells:
Here, at a bankkeeper,
AMERITECH: Phone companies operate in Illinois,
Indiana and Ohio and Wisconsin. Unregulated
industries in financing, cellular and paging products
and services and directory publishing. Its 1987 net income was $1.2 billion, revenues were $9.5 billion and assets were $18.8 billion.
BELL ATLANTIC: Phone companies operate in Maryland, New Jersey, Pennsylvania, Virginia, West Virginia and Washington, D.C. Unregulated ventures include computer maintenance, equipment leasing, data and network software, Yellow Pages and cellular phones. Its 1987 net income was $1.2 billion on revenues of $10.3 billion with assets of $21.2 billion.
billion with assets of $1.2 billion.
BELL SOUTH: Phone companies operate in Louisiana
Mississippi, Alabama, Georgia, Florida, South Carolina, North Carolina, Tennessee and Kentucky. Investments include computer leasing and maintenance services, driveway publishing, communications systems and equipment and cellular phone and paging services. Its 1997 net income was $1.7 billion on revenues of $12 billion. With assets of $27.4 billion it is the largest of the Baby Bells.
**NYKEN:** Phone services in Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, New York and parts of southern Connecticut. Unregulated investments include computer and software marketing, financial products and services, directories publishing, cellular phone and paging services, real estate brokerage services. In 1987, it had $1.3 billion in net income, revenues of $12.1 billion and assets of $22.8 billion.
PACIFIC TELEISIS: Phone services in California and Nevada. Unregulated investments include cellular telephone and paging services, directory publishing and real estate development services. Reach 21 million. Purchase $1 billion and assets $2 billion.
**SOUTHWESTERN BELL:** Phone services in Texas, Oklahoma, Arkansas, Missouri and Kansas. Unregulated activities include directory publishing, telecommunications systems marketing, cellular phone equipment and services and paging services. Its 1987 net income was $1 billion, revenues were $8 billion and assets $2.15 billion.
U. S WEST: Phone services in Washington, Oregon, Idaho, Montana, Wyoming, Utah, Colorado, Arizona, New Mexico, North Dakota, South Dakota, Nebraska, Minnesota and Iowa. Unregulated investments in transaction-processing software, real estate, financial services, cellular phone and paging services, directory publishing and computer software and data base products for information management. Its 1987 net income was $1 billion, revenues were $8.4 billion and assets $19.1 billion.
Ma Bell breakup provokes change
Industry booms as options are added
The Associated Press
Remember when one call to Ma Bell could set up telephone service, get a phone fixed or straighten out a billing problem; when local telephone service was cheaper and all charges were included in a single monthly bill?
Ah, yes, those were the days
Or were they?
Or were they?
In the nearly five years since American Telephone &
Telegraph Co. was broken up by an antitrust lawsuit,
telecommunications in the United States has blossomed
into a $185 billion-a-year industry, up 60 percent from
1983
The cost of long-distance calling has plummeted 38 percent, and for heavier callers this more than makes up for higher local bills. Services like call waiting and call forwarding are widely available for average consumers, and phones now can do everything from remembering the number you last called to telling you what number is trying to reach you.
Options for voice, data and video networks abound for large corporations, and more services are on the way as companies enhance their networks with high-capacity fiber, ontine links and digital switches.
Toll-free 800 numbers are ubiquitous even for small businesses, and U.S. callers can now dial directly to most countries in the world.
countries in the world.
Opinion differs on whether all this change has been due solely to the competition wrought by the AT&T divestiture, or whether the search for new technology would have brought the dawn of the information age to our doorstep anyway.
The answer is clear to U.S. District Judge Harold Greene, who approved the terms of the breakup. In an interview with The Associated Press, Greene said there was no push by AT&T to get the results of its research into the hands of consumers.
into the tabs that they did is to change the black rotary dial phones to the yellow, beige push-button phones, which is nice, but in the last five years the kinds of innovative things that have occurred in household phones and business phones ... is the most astounding development.
Is that a confidence or not? But others note that the Federal Communications Commission had already begun to open the door to competition when the Reagan administration in 1981 thrust its marketplace philosophy into the telecommunications industry, quickening the pace of deregulation.
There is no question that the January 1984 breakup of Ma Bell moved industry competition into high gear. With AT&T's local operating companies, the Baby Bells, spun off as separate companies and ordered to provide access to their networks, AT&T's long-distance competitors lined up with new services tailored to meet the individual needs of different businesses.
Residential callers were offered cheaper ways to reach out and touch. The Baby Bells, no longer forced to buy their equipment from AT&T, went shopping — and telecommunications supply companies sprouted to compete for their business.
"the telecommunications market would be vastly different without divestiture," said Philip Ververe, the Justice Department antitrust lawyer who drafted the government's lawsuit against AT&T.
For typical callers, however, the breakup brought headaches and confusion. They no longer knew whom to
call about problems with their phone service, and they were being asked to be more than passive users of the telephone — they had to choose a long distance carrier or one would be chosen for them.
"Shopping for phone service is a lot more complicated than going to the grocery store, and people aren't used to shopping around in this area," said Gene Kimmelman of the Consumer Federation of America.
the conditioning to an AP-Media General poll, about 29 percent of Americans think the changes in AT&T were good, 31 percent think they were bad and 36 percent think they did not make much difference.
Eighty-six percent said their local phone service was good or excellent, and 82 percent felt that way about their long-distance service.
long-backed wrist was based on telephone interviews Nov. 10-20 with 1,094 randomly selected adults in the continental United States. It has a margin of error of plus or minus 3 percentage points.
Even though fledgling competitors were offering rates 10 percent and more below those of AT&T, the long-distance leader, many stuck with the old faithful.
"People don't like making decisions if they don't have to, and they were being forced to make decisions," said A. Michael Noll, a communications professor at the University of Southern California.
Kimmelman also says the breakup and contemporaneous decisions of the FCC and state utilities commissions have resulted in higher phone bills for the majority of Americans.
Soon after divestiture, the FCC ended a rate structure that inflated long-distance rates to subsidize local service and state utilities commissions allowed healthy rate increases over fears that the Baby Bells might not survive as independent companies. Since then, long-distance rates have dropped by more than third but local rates are up by about 60 percent, Kimmelman said.
He maintains that most callers don't make enough long-distance calls to make up for the higher local rates.
According to the Bureau of Labor Statistics's consumer price index, long-distance rates have dropped more than 35 percent while local charges have risen nearly 40 percent since 1984.
"Since divesiture, the overall price of phone service has kept up with inflation, whereas in the 50-year period prior to divesiture, the overall price of phone service was only a third as much as inflation," he said.
Other costs increased too. Phone companies are now charging for directory assistance, and alternative operator services sprung up to serve hotel, pay phone and other traveling callers calling rates several times those of AT&T and rivals MCI Communications Corp. and US Sprint Communications Co.
"Everything has become a profit center," said consumer advocate Ralph Nader.
Despite local price increases, more American households than ever — 85.3 million, or 92.9 percent of the total, up from 91.4 percent five years ago — have telephones, according to the Census Bureau. And the average American is spending more time on the phone — nearly 50 minutes per day, up from 42 minutes at divestiture, according to the FCC.
"It has become evermore an essential tool in life," said Eli Noam, a member of the New York state Public Service Commission.
Education group works to recruit minority teachers
Role models help students focus on professional goals
By James Farquhar Kansan staff writer
Grade school and high school students commonly latch on to their favorite teacher as a role model for themselves.
But experts say that when minority students see few teachers of their race, it may leave them wondering how to succeed in the professional world.
The scarcity also deprives majority students of the benefits gained from ethnically diverse role models, said Juqain Padilla, a counselor at the minority-rich Garden City high school.
"Studies have shown that a disproportionately low number of minority teachers has affected minority students' professions negatively," Padilla said.
These concerns led the KU School of Education last year to form a permanent committee to spearhead minority recruitment and retention programs for the school.
Padilla pointed to "One Third of a Nation," a national study released in May by the Commission on Minority Education and American Life.
American Blue The percentage of minority school-aged students is predicted to increase from 20 percent in 1985 to 33 percent by the year 2000, according to the study.
Meanwhile, the study said that the number of minorities seeking
Jerry Bailey associate dean of education
"The numbers bode ill for the profession of teaching," he said. With the gap between the number of total minorities and the number of minority teachers widening, I'm discouraged.
careers as teachers was declining. The percentage of first-year education students decreased from 13.4 in 1977 to 8.7 percent in 1986.
"The numbers bode ill for the profession of teaching," he said. "With the gap between the number of total minorities and the number of minority teachers widening, I'm discouraged."
Bailey said that real change would not come overnight, but that the committee was trying to get the progress started.
Jerry Bailey, associate dean of education and chairman of the committee, said the trend worried him.
Earle Knowlton, associate professor of special education and a member of the group, said that committee members had canvassed area community colleges personally to reach out to minority students.
"We've spent some time at the Metropolitan Community Colleges in Kansas City, Missouri, such as Penn Valley and Longview, to let them know that we want them to come to our school," Knowlton said.
"I think probably the best thing that came from our visit was the information that we were able to share with the students, letting them know what they need to do now to come to our school later," he said.
Bailey said that the group also had effected scholarship allotment in the school of education.
"Last year, the committee requested that at least two scholarships be given to incoming minority students and at least two more be given to minority transfer students," Bailey said.
In previous years, education scholarships only had been given on the basis of merit. He said that this year the school gave an opportunity to students without the best high school education.
Bailey said the committee was pursuing an articulation agreement with the Metropolitan Community Colleges. The agreement would provide KU scholarships to teaching-education scholarship students who had successfully completed the two-year community college program.
Daniel Starling/KANSAN
Write it off
Students are not the only people burdened with homework. Jerri Nlebaum, Lawrence resident and KU graduate, works on a story for the Kansas Alumni Magazine late yesterday at Duds 'n' Suds, 918 Mississippi St., while doing laundry.