- The Washington Times - Tuesday, December 31, 2002

Many consumers will ring up more long-distance charges beginning tomorrow.
AT&T; Corp. and WorldCom Inc.'s MCI residential unit are raising rates and introducing fees that take effect tomorrow for new subscribers. The phone companies will pass on some of the higher costs to current subscribers in March.
"MCI led the industry in cutting rates. Now they're leading the industry in raising them," said Rich Sayers, founder of www.10-10PhoneRates.com, a Web site in Martinez, Calif., that monitors some phone rates.
MCI, the nation's second-largest long-distance company, has raised rates four times this year. Parent company WorldCom filed the largest bankruptcy in U.S. history in July.
Aggressive competition in the long-distance market led to lower rates after passage of the Telecommunications Act of 1996. But the era of cheap long distance could be ending. Competition from cell-phone providers and declining sales have hurt long-distance carriers.
AT&T; posted a 26 percent decline in third-quarter consumer sales to $2.8 billion. Sprint Corp. has projected a slip in revenue next year from $15.2 billion to $15 billion.
"It's becoming more and more difficult for consumers to find competitive deals," Consumers Union spokesman David Butler said.
Sprint Corp. said yesterday that it is considering rate increases. The company reported in a regulatory filing last month as having 26 million business and residential long-distance subscribers. Sprint is the nation's third-largest long-distance carrier, based on the number of residential customers.
"We are evaluating a variety of options, but we don't have anything confirmed," Sprint spokeswoman Jennifer Love said.
Sprint has raised some fees recently. In the past month, the Kansas carrier increased a fee for non-Sprint subscribers who place state-to-state long-distance calls on the company's network through 10-10, or dial-around, calling plans. It also raised an international access fee from $5.49 to $6.49.
MCI, which has an estimated 20 million residential subscribers, announced some increases in November and December.
AT&T;, with 50 million residential long-distance customers, said last week that it will raise some rates.
MCI will increase the federal universal service fee from 9.9 percent to 10.5 percent. The fee helps pay for phone-calling service in rural areas. The company also will add a "carrier cost recovery" charge of 0.5 percent from Feb. 1 to offset the cost of some regulations.
The company raised from $1.50 to $2.50 the monthly fee to have MCI long-distance charges listed on a customer's local phone bill. That increase takes effect tomorrow.
MCI also will raise a basic monthly minimum-use requirement fee from $3 to $5. Customers will be charged $5 a month even if they make no calls.
AT&T; will raise some rates as of tomorrow. New subscribers enrolling in the company's 7-cents-a-minute long-distance plan will pay a monthly charge of $4.95, up from $3.95.
AT&T; will boost the same rate for current subscribers no sooner than March.
"It's really to bring us in line with the rest of the industry," AT&T; spokesman Gary Morgenstern said.

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