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| MCI, Pacific Bell Feud Over Prison Deal |
| By Associated Press |
| Published: 12/16/2002 |
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In yet another instance of telecommunications industry infighting, WorldCom Inc. and SBC Communications Inc. are squabbling over who has the right to provide local phone service to California prison inmates. SBC's Pacific Bell, in a bankruptcy court filing, charged that WorldCom's MCI unit illegally disconnected Pacific Bell pay phones in several California juvenile prisons and then hooked its own local lines into the phones. WorldCom says MCI has the right to provide phone service and equipment under a February contract with the state of California. The case -- which is being played out in court as part of WorldCom's largest-ever U.S. bankruptcy filing -- is just the latest salvo in a heated battle between WorldCom and SBC in particular, and between 'Baby Bell' local phone companies and long-distance rivals in general. MCI, the nation's No. 2 long-distance carrier, now also offers local phone service in 40 states, including California, where Pacific Bell is the dominant provider. Pacific Bell itself is seeking permission to offer long-distance in California and also is asking the state to let it charge MCI and others more to lease its phone lines. San Antonio-based SBC, the nation's second-largest local phone provider, has charged MCI used deceptive tactics in several states to get SBC customers to switch to MCI. In the prison phone case, MCI has had a contract for 10 years to provide local and long-distance service for 85 percent of the 3,000 phones in 49 California state prisons and juvenile facilities. Pacific Bell had a subcontract with MCI to provide the local service and the phones. Verizon Communications Inc. provides service to the other 15 percent of the prison phones. In 2001, according to the California Department of General Services, the 3,000 phones generated $85 million in revenue. In February, when MCI signed another contract with California, it decided to offer the local service itself and install its own phones. |
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