This week, Congress will begin grilling the Federal Communications Commission on plans to reduce pro-competition rules written following the enactment of the Telecommunications Act of 1996. Although local telephone carriers have made progress over the past seven years in gaining access to the long distance and Internet markets, few rival carriers have made significant inroads into the local carriers territory.
The enterprise market is considerably more competitive today than the consumer market; and business centers, unlike residential neighborhoods, generally enjoy choices for all levels of telecom services. Because of the relative competition in the enterprise market, the FCC may begin to phase out regulations in that market first.
Like its fellow Regional Bell Operating Companies, BellSouth Corp. has boosted its efforts to gain a larger share of the lucrative enterprise market. SunTrust Bank Inc. in Atlanta buys local, long distance and data services from the local telephone company.
John Hutto, SunTrusts senior vice president for Network and Telecommunication Services, said there are advantages in signing up with the local carrier for a full range of services—but only as long as competitive options remain in place. What Hutto said he appreciates most is the mix of services BellSouth provides and the close carrier-customer relationship that the local carrier has cultivated for decades.
"Generally speaking, BellSouth knows us better than anybody else, and we know them better than anybody else," Hutto said. "We also enjoy a level of diversity, and thats particularly important given where telecom industry is right now. Im not sure we would move all our services to any one provider."
One of the countrys ten largest banks, SunTrust has 1600 branch offices coast-to-coast, but its greatest presence is in the Southeast, largely overlapping BellSouths territory. After BellSouth won FCC approval to provide long distance services in Georgia, SunTrust signed up for it, Hutto said.
"We did have some great choices [in long distance]," he said. "Were also a large customer of WorldCom [Inc.] and AT&T [Corp.], and we get pretty good service from those guys too. But BellSouth brings an additional player into this market."
SunTrust also dropped WorldComs data services in Georgia in favor of BellSouths, and the local carrier also provides metropolitan area network services to the bank in Atlanta and Orlando, according to Hutto. But because the local carrier has very little experience working outside its own region, it would be better off partnering with a nationwide carrier to provide data services beyond the Southeast, he said.
"From the perspective of the local carriers, they bring better customer knowledge with them," Hutto said. "The long-distance carriers are going to bring some of the strengths of large-scale data capabilities."
Most recently, SunTrust contracted with BellSouth for a check-imaging program, for which the local carrier will provide Internet access and point-to-point circuits. The service offers an efficient way for the bank to store checks and provide them to customers on request, Hutto said.