TELECOM Digest OnLine - Sorted: Re: Verizon GTE Merger -- How Did it Go?

Re: Verizon GTE Merger -- How Did it Go?
Wed, 30 Nov 2005 16:07:45 EST

In a message dated 30 Nov 2005 07:35:52 -0800,

> A while back Verizon (formerly Bell Atlantic and Nynex NY Telephone et
> al) acquired GTE -- General Telephone & Electronics local phone
> companies. GTE was the biggest of the "independents", that is, local
> telephone companies not affiliated with the Bell System.

> I was wondering how well the integration of GTE into Verizon was
> working.

> The former Bell System was heavilly standardized, down to the pens on
> desktops. Most equipment came from Western Electric and usually
> (though not always) was the same throughout the country. By equipment
> I mean switchgear, carrier technology, and local loop plant (and pay
> phones). Also, business practices were somewhat consistent, such as
> rate plans and service representative styles.

The standardization certainly existed, but it was by no means total.
I don't remember anything about pens on desktops, for example.

Rate plans certainly varied all over the place. Message rate service
was the only service offering in many places; but in most places it
was optional and flat rate service was chosen by a very large majority
of customers.

After the breakup in 1984, the Bell operating companies were in a
stampede to find other suppliers that Western Electric. W.E. was in
the unfamiliar position of having to compete for business, and other
manufacturers got a lot of the Bell business, including C.O. gear and
outside plant.

Carrier technology was pretty common across many telephone companies,
with many circuits and systems jointly owned with the independent
companies owning the pnysical plant and terminal gear in its territory
and the Bell company the same in its territory. Compatible gear was
available from numerous independent suppliers.

W.E. gear, usually made to specs furnished by Bell Labs, was designed
with the idea it would be in place for many years and was built to
extremely high standards. This was particularly true of customer
premises equipment, where the local telco provided all the
maintenance -- on-premises maintenance. The cost of a repair call,
whether for a simple telephone set or a massive centrex or PBX, was
high, and it made sense to build the equipment to last. When
customers were permitted and then required to buy and maintain their
own equipment, this no longer made sense, particular for such simple
gear such as a telephone set.

> A key difference between Bell and GTE was that overall GTE (and the
> other independents) tended to serve much less densely populated areas.
> A map of Pennsylvania shows half the land mass of the state served by
> "independents" yet the vast majority of phones were under Bell
> control. Historically, Bell gained control of the cities and nearby
> suburbs while the independents were generally left with the rural
> areas (there are some exceptions). I wonder if this characteristic
> has impacted the merger.

An effect of this in rapidly growing areas was the the independents,
frequently bought up by GTE, owned the areas of high-growth,
high-income in the suburbs. Some of this places where this was
particular noticeable was in the Southern California area (General of
California was larger than at least a couple of the Bell operating
companies and attracted some senior Bell executives to fill high-level
vacancies), Dallas (Irving, Las Colinas where many corporate
headquarters are located, Plano, much of Carrolton and numerous
others). In the Tulsa area, General, later GTE, owned the Broken
Arrow exchange which served not only the growing and high-dollar
limits of its namesake city but also well into the adjoining similar
territory in the municipal limits of Tulsa. (As an aside, Bell
speakers at the national level were wont to extol the virtues of a
single nationwide long distance network by noting that you could reach
even such remote places as Broken Arrow, Oklahoma, which always made
us in Oklahoma snicker because it was about as non-remote a place as
anywhere in the country. They probably meant Broken Bow, a place that
would more or less fit the "remote" description and was served by a
well run, locally-owned, non-GTE independent.)

Wes Leatherock

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