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open-market violations

ICS/Executone protests
open-market violations

Complaints to the state Public Service Commission this week could be the prelude to an antitrust lawsuit that ICS/Executone Telecom Inc. plans to file against Rochester Telephone Corp., President I.C. Shah said today.
Ongoing concerns that Rochester Tel, a local Frontier Corp.

ICS/Executone protests
open-market violations

Complaints to the state Public Service Commission this week could be the prelude to an antitrust lawsuit that ICS/Executone Telecom Inc. plans to file against Rochester Telephone Corp., President I.C. Shah said today.
Ongoing concerns that Rochester Tel, a local Frontier Corp. subsidiary, is violating terms of the open-market plan prompted Shah to send a letter yesterday to PSC Chairman John O’Mara. The PSC oversees competition in Rochester, which in January 1995 became the country’s first open market for local phone service.
“Frontier deliberately misrepresented itself to the Public Service Commission on various issues during the Open Market negotiations, and has intentionally inhibited competition from entering the marketplace,” the letter states.
Shah sent a previous letter to O’Mara in January, asking the PSC to prevent Rochester Tel from marketing unregulated products and services, including caller ID and Internet services. The company included promotional inserts for these services in billing statements mailed to customers.
Rochester Tel responded with its own letter to O’Mara in February.
In it, the firm’s general attorney, Gregg Sayre, asserted that the plan does indeed allow Rochester Tel “to retain–and by implication, to market–unregulated products and services.”
Sayre also contends competitors are able to place marketing inserts in Rochester Tel’s bills.
“ICS/Executone, AT&T, ACC and any other local or long-distance carrier are perfectly free to use this marketing channel,” the letter states, suggesting that Shah contact the firm for more information.
On April 15, Shah sent a letter to Rochester Tel’s president, Denise Gutstein, asking for details on how to use this marketing channel.
According to Shah’s June 24 letter to O’Mara, he has received no response to that request.
ICS/Executone also claims that Rochester Tel has not transferred its voice-mail services to Frontier Communications of Rochester Inc., the firm’s sister subsidiary. The open-market agreement mandated that Rochester Tel make the transfer or sell its voice-mail service to the highest bidder.
“It is my understanding that now Rochester Tel is petitioning the Public Service Commission to allow it to keep the voice-mail business,” Shah’s recent letter states. “Once again, here is another example of Rochester Tel’s ongoing monopolization of the open market.”
“I personally believe that the open market has turned out to be a big scam,” Shah said in an interview today with the Rochester Business Journal.
AT&T Corp., which resells local phone service in Rochester, also has filed a complaint with the PSC, hoping among other things to force Rochester Tel to lower the rates it charges wholesale customers. The PSC has not yet ruled on that issue.
Shah believes the PSC is “so thrilled to be the first state in the country to have competition,” that they “absolutely, literally look the other way.”
That’s one reason why ICS/Executone plans to take its case to court, Shah said. Other issues that Shah declined to disclose will be included in the firm’s antitrust lawsuit against Rochester Tel, he said. Shah expects his attorneys to file that suit within the next month or so.
ICS/Executone was involved in an earlier antitrust suit filed against Rochester Tel in the late 1970s. That suit eventually was settled out of court.

RBJ Daily Edition 6-25-96

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