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AT&T to Compete With Ameritech

June 11, 2001

LANSING, Mich. (AP) _ AT&T Corp. will compete against Ameritech as it seeks to offer local phone service to customers in Michigan by the end of the year.

But AT&T’s decision to enter Michigan’s local market hinges on whether Ameritech’s operating system can handle switching customers to AT&T, said Phil Tonge, president of local markets for AT&T.

``We think the conditions are right to be successful in competing,″ Tonge said during a teleconference from his Texas office.

Now, AT&T provides local service in Texas and New York. It only provides long distance in Michigan, but eventually Ameritech Michigan customers could switch their local service provider by calling AT&T.

AT&T started to offer local service in 1997 in Michigan, but stopped in 1998 because the company wasn’t making money on the venture.

Under the new plan, AT&T will lease parts of Ameritech’s local networks and use them to offer competing service under the AT&T brand.

Tonge attributed AT&T’s decision to get into local service to a new deregulation law as well as the Michigan Public Commission’s efforts to limit the cost Ameritech can charge to use its lines.

Ameritech spokesman Mike Barnhart said the Chicago-based company, which handles 96 percent of the phone lines in its part of Michigan, welcomed AT&T’s announcement as a sign that competition is growing.

Ameritech, which is owned by San Antonio-based SBC Communications Inc., is going through the process with state regulators to offer long distance in Michigan.

AT&T isn’t planning on getting into the mostly rural areas where local telephone service is provided by Verizon, formerly GTE Corp. Verizon owns nearly 800,000 phone lines, which is 100 percent of the lines in its areas.


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