Friday, February 25, 2005

BellSouth threatens pullout

"BellSouth threatens pullout" is the headline in a story which could have been about Bill Oliver scuttling down to the capital paper to try and get an endorsement from some newspaper after the Advertiser's stunning 4-part endorsement of the city-parish/LUS fiber plan.

BellSouth in a bit of calculated rage threatens to pull its low-wage job center, built with substantial public give-backs out of Lafayette if LUS should become successful. What they don't threaten (because that is the more "realistic" likelihood) is that they might cease developing their system in Lafayette in the face of real competition that shrinks their profit-margin. Instead they try and threaten to take away that which the don't own (they are a 40% shareholder in Cingular with SBC owning the other 60%). There are those who think that the sorts of low-level, poorly paid jobs that are characteristic of call centers is the best that the people of Lafayette can hope for. Except for a few, those people live outside Lafayette.

The people who live in Lafayette, and their representatives, think we can do better than counting on just the sorts of jobs that are regularly outsourced to third world companies for our community's future. And lots of folks don't like to be threatened. It's no accident, I feel sure, that this off-the-cuff remark was made in a closed editorial meeting that would normally be immune to reporting. My guess is that Oliver won't be too happy that his threat is being reported. He has better strategic sense than to bandy about in public something that is more useful in impressing "influentials." Another indication that he didn't really think he was talking to the public is that he reiterated a claim that got him in to hot water early in the fight for fiber here in Lafayette: that the people of Lafayette don't really need any more than we've got in the way of telecommunications. Now there is a classic little bit of arrogance.

Kudo's to the Advocate for reporting the sorts of unsupportable claims and threats that are usually made behind closed doors.

Update 3:24 (from Baltimore's Inner Harbor) --I got a call from Lafayette this morning reporting that the folks at the Lafayette call center are pretty POed at being treated like expendable munition in BellSouth's fight with Lafayette. Apparently an email is making the rounds complaining about BellSouth't presumptions. (These folks don't feel like they are working for BellSouth.) Apparently it's being "discussed" up the management line...

I also see an announcement of a joint LUS/City-Parish/LEDA conference to respond to the BellSouth threat set for 3:00 pm. Not being in the fair city I can't make it. I'd be curious to get a report filling me/us in here. What's new and unique is the inclusion of LEDA in the repsonse. LEDA's been one of the folks that reason and scuttlebut tell us have been in favor of the fiber plan but haven't come out clearly and publicly for "relationship" reasons. Maybe this will prove the final offense that leads to the marriage coming unglued. It would be good for LEDA to stand up and come out of the closet. sure isn't looking like threatening Lafayette is turning out well for Oliver. Or BellSouth


Mike Stagg said...

"Blackmail" is, I believe, the proper term for this.

Look, none of this BellSouth/Cox/Sock Puppets stuff is about anything else than doing whatever is necessary or possible to try to kill the LUS initiative.

The Cingular call center might well close any way, thanks to the Cingular merger with AT&T. There are no guarantees that the center remains open regardless of what LUS does.

Bill Oliver's problem is that he can't convince his bosses in Atlanta to make the kind of infrastructure investments in Louisiana that might help his operation here retain marketshare.

Without that infrastructure investment, BellSouth is roadkill for Cox and the cable companies in the only markets that matter to them in Louisiana — the metro markets.

I've heard that there is talk in Atlanta of BellSouth pulling out of Louisiana all together within two years. That they will shut down their regional office in New Orleans.

That's the word.

Will Bill Oliver blame this on LUS, too?

GumboFilé said...

This should come as no surprise. LUS has the power to make it impossible to compete profitably.

Anonymous said...

What should come as no suprise? That Bellsouth is threatening blackmail in a business that has nothing to do with fiber directly? Yea, that IS no suprise. It's just the sort of scare tactics that incumbents have historically resorted to in other munis besides Lafayette.

GumboFilé said...

It should come as no surprise that any business, when threatened with the prospect of being pushed out of a market, not by fair competition, but by the coercive power of civil government, should want to leave that hostile territory.

Anonymous said...

This is a threat that Oliver has been making from day one. . .just not publicly. I hear that LEDA is not worried about this in the least.

With a building and infrastructure already there, along with significant public give-backs, they'd be crazy to actually pull out of Lafayette. And, if they did, there are a number of other companies already lined up to take their place. Imagine walking into a situation where you've already got a building, the infrastructure (meaning fiber), and a workforce that is already trained. . .sounds like good business to me.

In other words, its and idle threat meant to scare, but in truth has no bearing on the matter at hand.

GumboFilé said...

Can I presume from your statement that you think that being pushed out of a market, not by fair competition, but by the coercive power of civil government, is ok?

John said...

gumbofile, not sure who you are addressing here (it would be good to be more careful about that) but I will be happy to respond for myself.

There is no coercive state power being exercised here. Sorry. But its true. No one will be forced to buy from LUS. (Just as no one is forced to buy from BS or Cox) -- at least in the sense I think you mean.) You can vote with you dollars. Now you'll have to vote for an inferior service that's more expensive. But the only coercion that wil be exercised here will be market-based. People will buy better for less. The real issue is competition. BS and Cox are long-standing monopolie that resist any and all attempts at competition.

(Look up Cox's behavior in Arizona on this site for a great example of the way Cox treats all competition even the private sort --in that instance they tried to force satellite operators to pay the same fees for using rights of way that they pay.)

(BS is just the same. It has spent its energies driving companies like EATEL--a local corp that seems to actually care about its customers--out of the market by regulatory means.Check around cheap EATEL service is no longer available.)

It's not government. It's competition. And they are deathly afraid of it.


GumboFilé said...

I can't defend corporations when they try to use the coercive power of civil government in their favor. That's one problem with our economic system. It's not true free-enterprise. It's mercantilism, or corporate capitalism. It's not a matter of who best competes in the marketplace, but who competes best in the lobbies of the federal and state legislatures. It's nothing but another form of socialism. That being said, this doesn't in any way affect the essence of my main argument, which is, civil government, for reasons I have already stated elsewhere, should not be allowed to compete with previously existing business.