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November 27, 1995

AT&T SLAMS “LIFE-THREATENING HURDLES” TO NEW ENTRANTS IN DEUTSCHE TELEKOM PLAN

By CBR Staff Writer

AT&T Corp has asked German postal minister Wolfgang Btsch not to approve Deutsche Telekom AG’s planned new rate structure, which it warns will hinder competition. The plan, due to take effect on January 1, would reduce prices for major telephone subscribers by up to 46% (CI No 2,800). In its new rate structure, Deutsche Telekom is trying to torpedo fair competition in the future liberalised German telecommunications market, said AT&T Deutschland chairman Werner Suelzer: it is building life-threatening hurdles for the new telephone companies. Telekom can only afford to offer discounts of this size if these are subsidised by its local loop monopoly. At the same time it discriminates against residential customers, who will have to pay higher local access charges starting in 1996. The prices for major clients may be below the charge new competitors have to pay Deutsche Telekom for connections to the local network, and may be in violation of Article 86 of the Treaty of Rome, which bars market-dominating enterprises from taking steps to limit competition or to set unfair prices, it said.

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