Article by Central Staff
Communications – March 1999 – Colorado Central Magazine
Ma Bell Puts Us Up for Adoption
US West, the regional Baby Bell telephone monopoly, wants out of Central Colorado. The company has put 18 rural Colorado exchanges up for sale, and these include Salida, Buena Vista, Fairplay, Gunnison, Monte Vista, and Alamosa.
Why doesn’t US West want us any more?
Telephone economics are complicated, but it starts with the fact that the more customers you have for each mile of cable, the more money you make. Thus urban areas are much more profitable than rural areas.
When US West was essentially the only phone company providing local service, it could average these costs. But it now faces competition in urban areas, so it must cut rates to compete there, and that eliminates a source of internal subsidy for high-cost rural areas.
There is a federal program to subsidize service to rural areas from the “high cost fund” that is levied on all telephone bills.
However, that money is available only to companies that specialize in rural service. Because most of its customers are urban, US West can’t tap into it.
Thus a sale of our exchanges might be a good deal all around. We could get a phone company with access to more resources that might be invested in better service, and US West will get rid of some exchanges that it can’t afford to invest in.
US West has already sold some exchanges in this area, among them Westcliffe, Saguache, and Guffey.
A new phone company might also be able to cure a major complaint from Leadville — half of Lake County’s workforce commutes to the I-70 corridor, which is not only a long-distance call, but is in another area code.
US West says its regulatory restrictions keep it from expanding the Leadville local-calling area to Vail and Frisco, but that the new local phone company would be allowed to run a cable from Leadville to the interstate.
That change in phone service is coming, but another one has already happened.
US West did have a monopoly on calls inside the 719 area code. That is, you could pick your own long-distance carrier for calls that went out of state, or to the other Colorado area codes of 970, 303, and 720. But if it was a long-distance call inside 719 (like Salida to Alamosa), it had to go through US West.
Now that long-distance market has been opened to competition, and we just can’t wait for those solicitors to start calling while we’re eating dinner.