AT&T and rivals boost rates further; move arms critics who say long-distance market needs more competition

Article Abstract:

AT&T's long-distance rate increase, which takes effect Dec 1 1996, has been offered by critics as evidence that the long-distance market lacks sufficient competition. The increases include 5.9% on interstate calls, 5% on calling-card and 2.6% on operator-assisted calls. AT&T's rivals, MCI and Sprint, have also raised their rates. An AT&T spokesperson said the increases were necessary for it to recover its investments in marketing, technology and forays into the local and wireless telephone markets. The regional Bells claim the increases from the three major companies demonstrate the need for more competition. Analysts are surprised by the timing of AT&T's announcement given its efforts to maintain its customer base and regulators' efforts to stimulate competitive prices. Congress recently enacted legislation to open both local and long-distance markets to competition. Many states have ordered local carriers to lower access fees for long-distance companies.

Wired Telecommunications Carriers, Long Distance Telephone Svc, Prices and rates, Telecommunications services industry, Telecommunications industry, AT&T Corp., Long distance telephone services, Long-distance telephone service, Company pricing policy

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Spectrum stock drops as AT&T discusses pact

Article Abstract:

Spectrum Information Technologies Inc's stock fell 49 percent on May 20, 1993, closing at $6 a share. Spectrum's stock had been doing spectacularly well since May 11, when Spectrum announced a licensing agreement with AT and T. Spectrum's stock had increased from $4 a share a week ago to $13.125 on the morning of May 20, but on that day, a report on CNBC cable television cast doubt on the value of the AT and T deal. AT and T reportedly had envisioned a vast and growing market chip for modem chips incorporating Spectrum designs. A market for almost a billion chips was foreseen. According to Spectrum Pres Peter Caserta, the AT and T agreement would generate hundreds of millions of dollars of revenue. A spokesman for AT and T now disputes such projections, saying the agreement is worth a few million dollars.

Telephone and telegraph apparatus, Electronic computers, Radio & TV communications equipment, Holding companies, not elsewhere classified, Computer networks, Wireless LANs, Telecommunications equipment, Securities, Licensing agreements, Cellular telephone equipment industry, American Telephone and Telegraph Co., Communications Equipment, Outlook, Cellular Radio, Stock, Wireless Network, Spectrum Information Technologies Inc.

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