$// Pub. Not.; Bell Atl.; Nondominant Provider; DA 95-1666 //$ 
$/ Section 0.291 Delegated Authority /$
TRANSMITTED FOR FCC RECORD ONLY
                                                           DA 95-1666    
                                                                         
                                                                         
                                                                         
                                                                         
                                                            July 26, 1995
                                                                         
                                                                         
                  Bell Atlantic Petition for Regulation
                 as a Nondominant Provider of Interstate
                       InterLATA Corridor Service
                                    
                                    
                                    
COMMENTS:  August 25, 1995

REPLY COMMENTS:  September 11, 1995


     On July 7, 1995, Bell Atlantic filed a petition for waiver
of Sections 61.23(c), 61.42(f), 61.42(d)(4) and 61.58 of the
Commission's rules, 47 C.F.R.  61.23(c), 61.42(f), 61.42(d)(4)
and 61.58.  Bell Atlantic seeks a waiver of these rules in order
to be regulated as a nondominant provider of interstate interLATA
services in the corridor areas it serves.

     According to Bell Atlantic, the Modification of Final
Judgment (MFJ) created the corridor service areas as a limited
exception to the restrictions placed on the Bell Operating
Companies to provide interLATA service.  See United States v.
Western Electric Co., 569 F. Supp. 990 (D.D.C. 1983).  Bell
Atlantic states that it offers three interstate services pursuant
to the exception -- service from northern New Jersey to New York;
service from Philadelphia to southern New Jersey and service from
southern New Jersey to Philadelphia.

     Bell Atlantic contends that despite its current regulatory
status as a dominant carrier, it is only a "niche provider" of
interLATA services in the corridor areas it serves.  It states
that approximately 90 percent of the potential customers in the
corridor areas do not use its corridor service.  Bell Atlantic
further claims that there are approximately 90 alternative
providers, many of which have a national presence that provides
those competitors with a competitive advantage over Bell
Atlantic.  Bell Atlantic also contends that the MFJ limits its
long distance service to the three corridor areas, that its basic
rates in these areas are approximately 20 to 30 percent lower
than the basic rates of the three largest long distance carriers,
and that it lacks market power for corridor services.

     Bell Atlantic argues that the Commission's rules impose more
restrictive regulatory conditions on its provision of corridor
services than they impose on competitors that have larger market
shares.  Bell Atlantic notes that its tariffs must be filed on 45
days' notice, with full cost support, and are subject to price
cap regulation.  It claims that these requirements place it at a
competitive disadvantage because its nondominant competitors may
file tariffs on one day's notice, without cost support, and even
AT&T, the leading provider of interexchange services in the
corridor areas, may file tariffs for many of its services without
cost support on 14 days' notice.  According to Bell Atlantic,
regulating it as a dominant provider of interstate interLATA
corridor service inhibits price competition by giving competitors
an opportunity to develop a competitive response during the 45
days' notice period.

     Interested parties may file comments on Bell Atlantic's
petition for waiver no later than (30 days from notice).  Replies
may be filed no later than (15 days from comment).  In addition
to addressing the merits of Bell Atlantic's petition, commenters
are asked to address whether the issues raised by the petition
are more appropriately considered in an upcoming phase of CC
Docket No. 94-1, regarding the price cap performance of local
exchange carriers (LECs).  In such future proceedings, the
Commission will address the appropriate level of regulation for
LEC services which are now subject to price cap regulation, as
competition for those services develops.  See Price Cap
Performance Review for Local Exchange Carriers, First Report and
Order, CC Docket No. 94-1, FCC 95-132, para. 407 (adopted March
30, 1995; released April 7, 1995).

     An original and four copies of all comments and replies must
be filed in accordance with Section 1.51(c) of the Commission's
Rules, 47 C.F.R.  1.51(c).  In addition, one copy of each
pleading must be filed with International Transcription Service
(ITS), the Commission's duplicating contractor at its office at
2100 M Street, N.W., Suite 140, Washington, D.C. 20037 and one
copy with the Chief, Tariff Division, Room 518, 1919 M Street,
N.W., Washington, D.C. 20554.

     For further information, contact Richard D. Lerner, Tariff
Division, Common Carrier Bureau, (202) 418-1530.


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