FCC decision promises lower phone bills
Banks are expected to benefit from a decision made by the Federal Communications Commission (FCC) in April. The FCC decision concerned AT&T's so-called Tariff 12 offerings of customized telecommunications networks for large corporations.
Banks that use them have been able to cut their telecommunications costs with customized networks because they pay a single fee for a package of telecommunications services instead of paying separately for each service they use. AT&T's network packages can include a variety of voice communications services, such as telemarketing, as well as video and data communications services and network management. FCC decision. The FCC's 16-month investigation into AT&T's Tariff 12 filings led to two conclusions about the service. In one, the FCC said that AT&T's concept of developing customized telecommunications networks is not in violation of federal regulations.
In the other, the agency said that the Tariff 12 services AT&T had already developed for five corporations were unlawful because they contain geographic restrictions "that unreasonably limit the general availability of Tariff 12 packages." The FCC gave AT&T 30 days to withdraw or revise those five services.
Despite the second point, the FCC decision "is a huge victory for AT&T because the commission approved the concept and most of the details of AT&T's custom service offerings," says Brant Karstetter, an attorney with the San Francisco law firm of Morrison & Foerster, which represents the New York and California Clearing House Associations.
Customized networks will be affordable and beneficial to banks with several billion dollars of assets, a high volume of long distance phone calls, and offices that are very spread out, adds Hank Levine, partner and communications group chairman, Morrison & Foerster. Banker's reactions. A survey of several large banks by ABA BJ revealed both an awareness of and interest in customized telecommunications networks offered by AT&T and other long distance companies, such as MCI Communications Corp.
"Tariff 12 gives AT&T the flexibility to be more competitive," says a spokesman for a large southern bank who did not want to be identified. "And that has to be to our advantage. It enables AT&T to look at the pieces of business a company does with it in total, and based on that total, present you with a better pricing break."
Bill Spies, vice-president, telecommunications, First National Bank of Maryland, Baltimore, says of Tariff 12, "It's a good idea. We would have used it but we have our own customized fiber optic communications network."
Pat Keane, group manager, voice engineering group, First Interstate Bank of California, Los Angeles, allows that the bank "would consider using a customized network instead of its private telecommunications network depending on the savings the package offered." But she says a customized network would have to offer a lower price per minute for calls than the 11 to 12 cents per minute it currently costs the bank using its own network. Developing packages. AT&T developed its first customized network for General Electric about one-and-a-half years ago. Since then it has developed customized packages for American Airlines, American Express, DuPont, and Ford Motor Co.
GE's customized network has "absolutely resulted in cost savings," according to Stan Welland, manager of corporate telecommunications, at GE's corporate information technology division, Bridgeport, Conn. …