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Us Canadians take it for granted that the incumbent local carriers (TELUS, Bell Canada, Sasktel, et al) offer Long-Distance services to their customers and are the default carriers. Not so in the US, where the big breakup in 1981 meant that the entire LD pie went to AT&T.

This advantage is why AT&T, which has screwed up just about every business they’ve ever entered, can continue to contain failure: in the vernacular of TelCo-ese, they shit money.

AT&T owns about 60% of the US LD market. A couple of years ago, they owned 70%. The 40% who aren’t with them churn pretty frequently among their competitors, following the special offers and freebies designed to attract customers, but loyalty to AT&T is being eaten away and they haven’t gained market share in years..

In Canada, on the other hand, 70% of LD is carried by the local phone companies, and statistics show that the same 30% of people not on the locals churn among the competitive carriers with the same frequency as their freeloading American cousins.

So what has AT&T scared is RBOCs entering LD. They have done and will do anything to stop it.

Lots of analysts are predicting a major exodus thanks to the power of local phone company bundling which will once and for all kick AT&T resoundingly in the ass. Those of us who’ve worked at BC TEL know very well the power of bundling and its ability to retain and gather customers. Unfortunately, though many have tried, there aren’t too many things that you can bundle with Long Distance.

-Ian.

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