The Federal Communications Commission Friday proposed to fine SBC Communications $6 million for violating a condition of its 1999 merger with Ameritech.
According to the FCC, SBC failed to meet a merger condition related to offering competitors access to the local phone network in the five states where Ameritech operated - Illinois, Indiana, Michigan, Ohio and Wisconsin. The agency said it conducted an investigation that determined SBC was not offering competing phone companies favorable terms for access to its network, as the merger condition stipulated.
Instead, "the commission found that SBC appears to have violated this condition in each of the five former Ameritech states by attempting to restrict the use of shared transport by carriers," read an FCC statement. Shared transports are the connections among a local phone carrier's central offices, which link businesses and residences into the local phone network.
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While the FCC does not have the power to approve or deny mergers, telecommunications companies must receive its permission to transfer operational licenses from one organization to another. The proposed $6 million fine is the maximum amount that the FCC can charge in these situations, officials said.
SBC on Friday refuted the Commission's findings.
"SBC has met our obligations under the SBC/Ameritech merger conditions to provide competitors with shared access to our networks in the Ameritech region and elsewhere. That's one reason why [competitive local exchange carriers] are serving 12 million access lines in our territory," read a statement issued by the company.
SBC has 30 days to pay the fine or to respond in writing to the FCC; the company plans to take the latter route.
Friday's announcement of the fine came in the form of an FCC document called a notice of apparent liability, which is issued by the agency's enforcement bureau before the organization in question is given an opportunity to respond, according to SBC officials. SBC believes that once the FCC reviews SBC's response to the notice, "it will conclude that SBC acted reasonably and in good faith," according to the statement.
The company added that the vigorous competition thriving in the five Ameritech states offers proof that SBC is operating in a fair manner.
The IDG News Service is a Network World affiliate.
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