Originally created 05/31/97

AT&T raising some pay phone charges



WASHINGTON (AP) - AT&T Corp.'s charges will increase by 35 cents Sunday for some pay phone customers.

The per-call increase results from a change in federal rules last year requiring AT&T and other telephone companies to pay owners of pay phones millions of dollars more for such calls.

The rate increase applies to pay phone calls made with credit cards or AT&T's calling card and to operated-assisted and collect calls. Coin calls rates remain the same.

Critics had complained that the Federal Communications Commission's new rules, which took effect last November, would make pay phone calls more expensive. AT&T, MCI and others are challenging the rules in court.

MCI spokeswoman Kelley Gannon said the company has not decided whether it would increase pay phone charges. Sprint had no immediate comment.

AT&T had no estimate of the number of customers who will be affected by the increase.

In addition to per-minute charges, AT&T calling card customers now pay a 35-cent surcharge for each call. There is an additional 60-cent charge for operator-assisted calls and $1.60 for collect calls.

The total charge for any given call depends on the time of day, distance and length of the call.

The 1996 telecommunications law directed the FCC to make the rule changes. Congress told the FCC to require AT&T and other companies that supply service to pay phones not only to compensate independent pay phone owners - as they have done for years - but also local telephone companies that own phones. The FCC set the compensation rate.

"Clearly, AT&T does not intend to profit at all from this action," said George Burnett, an AT&T vice president. "We are simply passing on the charges being levied by the FCC."

Eventually, the FCC's rules will let pay phone owners charge whatever they chose to companies such as AT&T.

The FCC's rules benefit the $4 billion pay telephone industry. There are 1.85 million pay phones in the country.

"It's certainly strange how the competition that has been developing since Congress passed the new telecommunications law also seems to be coming with higher prices," said Gene Kimmelman, co-director of the Consumers Union's Washington office.