in Washington

Washington - Last October, the Federal Communications Commission received a 40-page legal briefing with three appendices from a group calling itself the Ad Hoc Coalition of Corporate Telecommunications Service Managers and Telecommunications Manufacturing Companies.

The coalition, on behalf of signed users, urged the commission to approve BellSouth Corp.'s hotly debated application to enter the long-distance market in South Carolina. The group said it was certain that doing so would give users another option for long-distance service and force recalcitrant long-distance carriers to finally start competing for local business.

There was just one problem: None of the users were in South Carolina. The brief was written by Washington, D.C., communications lawyer Rodney Joyce, but the users contacted by Network World said they never paid Joyce to write the brief. Instead, they said Joyce contacted them to cosign what they thought was an objective statement to the FCC on increasing competition in telecommunications.

Joyce's bio From the Westlaw Legal Directory.

Who paid for the brief? Joyce's client: BellSouth.

Welcome to Washington, D.C., where the 2-year-old Telecommunications Act of 1996 is falling apart and two groups of warring carriers have desperately sought to marshal a confused public to their way of thinking with "user groups" that produce surveys, filings and studies proving it is the other guy's fault.

The trend disgusts the tiny band of advocates who actually represent - and are paid by - corporate network IS managers to get the FCC to do right by users.

"The carriers who fund these front groups believe these organizations bring some cover to their arguments," fumed James Blaszak, a Washington lawyer who represents about 20 large corporations such as American Express Co. and Procter & Gamble Co. on issues before the government. "But I don't think these groups help the FCC do their job one bit."

The piper pays

Many of these groups attempt to sign up phone company customers in their own particular way. Most have recruited a variety of community, ethnic, small business and senior citizen activist groups to join for nothing or a nominal sum and appear on their masthead. Some even go after corporate network IS managers. But often that just confuses the matter further, with users sometimes winding up expressing almost the opposite of what they actually intended.

For example? J.B. Shah, director of information technology for Electroglas, Inc. in Santa Clara, Calif., said Joyce's appeal for support caught his eye because Pacific Bell's charges for local calls are now more expensive than long-distance charges to call across the country.

"I feel that Pacific Bell is a monopoly, and they file one petition after another to raise their rates," Shah said. Shah signed the Ad Hoc Coalition letter because he thought it meant he was supporting increased local competition.

When told that his long-distance carrier, AT&T, opposed BellSouth's long-distance petition on the grounds that it would reduce local competition by ending BellSouth's incentive to open its local markets, Shah said he did not realize that. He also said he did not realize that Joyce in November had submitted a virtually identical brief from the "Ad Hoc Coalition" to the FCC supporting BellSouth's long-distance entry application for Louisiana.

Joyce and a BellSouth spokesman confirmed that BellSouth paid for the legal work, but neither brief contained mentioned that fact. "Our role has been to attempt to identify people who seem to have a shared philosophy about how best to promote competition," Joyce told Network World. "But I don't think there's any requirement for anyone to disclose who's paying them."

The bluejeans connection

IDI Web site Note the URL.

But the Bells' advocacy work goes well beyond technical FCC filings. The nerve center for much of the Bells' public-advocacy work is a firm called Issue Dynamics, Inc. (IDI), discretely housed in a cookie-cutter Washington office building two blocks from the White House. The firm is headed by Sam Simon, a self-styled '60s activist-turned-corporate advisor who, according to IDI's electronic brochure on the World Wide Web, is "as comfortable in a suit as he was in jeans."

IDI's associates help to organize and manage coalitions with names such as the "Alliance for Public Technology" and "Keep America Connected!" Often these groups run tag lines with unobjectionable goals, such as the stated mission of Keep America Connected! to mount a "National Campaign for Affordable Telecommunications." The literature for each group lists a different phone number manned by an IDI employee who answers the phone with the name of that coalition. It also lists either IDI's street address or a District of Columbia post office box.

Drawing on Simon's background, IDI's calling card is its ability to quietly muster public support for corporations' preferred positions on government policy. "We have close ties to the major players in the nontraditional world - education and consumer groups, minorities and the disability community," brags the company's online brochure. "We can identify and bring consumer support to bear on projects where appropriate," the brochure continues.

Alliance for Public Technology Web site

Some of the IDI-managed groups actually have achieved some standing. The Alliance for Public Technology has signed up 300 coalition members since 1989, including many universities, and weighed in heavily on the side of increasing access to new telecommunications services by less affluent people. The group's chairman, Dr. Barbara O'Connor, bristled at the suggestion that the alliance is a front for anything, noting that it has even held a seat on the FCC's prestigious Network Reliability Council.

But of the alliance's $190,000-per-year budget, approximately $100,000 is supplied by the regional Bell operating companies, she said. Not surprisingly, last October, the alliance wrote the FCC in support of BellSouth's South Carolina long-distance application and has consistently supported other RBOC policy positions.

O'Connor protested that every year the alliance approaches the long-distance carriers for contributions. "But once you take money from one side, the other side won't give you anything," she said. "They brand you [as an RBOC front] because it's part of the political rhetoric."

Other IDI groups do not have much of a track record. Keep America Connected! was organized in February 1997 and counts 45 organizations as members. Unlike the Alliance for Public Technology, the individual Bells are not members of Keep America Connected! Instead, the U.S. Telephone Association - the trade association for the nation's incumbent local carriers - is one of the 45 members. The group's literature usually discloses this fact indirectly by describing itself as a coalition of "consumers, people with disabilities, rural and urban residents, senior citizens, minorities, labor and local phone companies."

Yet most of the organization's budget consists of paying for part of the salary of an IDI employee, Angela Ledford, who is listed as the coalition's executive director. And its principal activity appears to be to responding in lightning-quick fashion to unfavorable reports about RBOC progress in opening local markets.

For example, two weeks ago the Consumer Federation of America issued a report blasting the RBOCs for making scant progress on local phone competition. Immediately, Keep America Connected! countered with a "consumer survey" in which ordinary consumers - who turned out to be mostly staffers of the coalition's member organizations - asked 78 competitive local carriers in 13 cities whether they served residential customers. Only two said they did, according to the coalition's report.

"Are the RBOCs clients of IDI? Yeah. Is Keep America Connected! housed at IDI? Sure," Ledford told Network World. "But we made no attempt to hide our connections. Now with the Consumer Federation of America, that's not clear."

Half a million bucks

Keep America Connected! and the Consumer Federation go head to head In an NPR broadcast. Requires RealAudio.

Indeed, when it comes to advocacy on behalf of the long-distance carriers, it is the Consumer Federation of America (CFA) that draws the most scrutiny. The organization is the granddaddy of consumer organizations and is highly respected on Capitol Hill and by regulatory agencies. Yet questions have arisen about its research director, Dr. Mark Cooper. In addition to his position as CFA research director, he also is president of his own Maryland-based firm called Citizens Research.

In a 1994 hearing before the Virginia State Corporation Commission, Cooper admitted that he has done survey and research work for AT&T and MCI.

Cooper told Network World that CFA does occasionally criticize AT&T for its basic residential rates. But on telecom reform implementation issues, he conceded that CFA basically takes one side of the issue. "You see a great deal of polarization on both sides," Cooper said. "That's just part of the process. That's just Washington."

Indeed, Cooper's work does show an almost vitriolic disdain for the RBOCs. The CFA report issued earlier this month - the one that triggered Keep America Connected!'s "consumer survey" in response - charged that consumers would lose as much as $10 billion per year in savings from lower phone bills if the Bells entered long distance before fully opening their local markets. "Currently there is virtually no significant competition for local telephone service because the Baby Bells have created insurmountable barriers to entry," Cooper charged in his report.

In fact, AT&T is a veritable fountain of research funding. Take the Competition Policy Institute (CPI), established in 1996 and staffed by former state regulators and congressional telecom committee staffers. In a recent hearing before the California Public Utilities Commission, CPI President Ron Binz admitted that AT&T has provided approximately $500,000 per year to the organization, with other long-distance carriers, competitive local carriers, cable TV and electric utility interests providing the rest. Not surprisingly, its reports and testimony have consistently laid the blame for the slow pace of telecom reform on the RBOCs.