American Telephone & Telegraph Co.'s interstate rate structure for large-volume users as well as its corporate responsibility in dealing with illegal political contributions came under attack yesterday by the Federal Communications Commission.
In a series of decisions involving the nation's largest communications company, the FCC concluded that AT&T's private-line rates are so complex and confusing that potential customers can't know what they're buying.
Separately, the regulatory agency said AT&T subsidiary Southern Bell Telephone, based in Atlanta, had violated the law by hiding political contributions made by its executives earlier in this decade.
AT&T's failure to take any action in the face of possible violations, when first reported in 1973, "reflects adversely on its duties and responsibilities as the parent of that subsidiary," said an FCC staff report approved by the agency yesterday.
At the same time, the FCC agreed with its staff that no actions should be taken against Southern Bell or AT&T, other than publication of the full report on alleged improper activities-which the FCC promised next week as "the most salutary and long-lasting remedial step . . . (a) public airing of the facts . . . "
In reviewing AT&T's charges to large business and government users, who buy communications services on private lines that are outside AT&T's normal long-distance operation, the FCC agreed with its staff that a thorough inquiry is required.
"Consumers now face a complex, almost bewildering variety of AT&T private-line tariffs which cannot easily be compared," said FCC Chairman Charles Ferris.
In some instances, different terms are used to describe the same basic service feature. "In these circumstances it is extremely difficult for customers to make informed choices as to what private-line services they want and need, whether offered by AT&T or its competitors," Ferris added.
Current rates may conceal illegal discrimination against some customers as well as improper cost justificaton, the FCC staff said in its report. In addition, the staff raised questions about volume discounts. One remedy suggested would be requiring uniform basic rates for various services, as part of an overall rate structure for specific customers.
The FCC asked for public comments by Jan. 7 on changes in the private line rates, which accounted for $1.3 billion of AT&T's $12.7 billion interstate revenues last year. AT&T said its executives think that the current rates "are appropriate both in describing the services and in the charges. . ." The firm said it would submit a proposal in response to the FCC action.
The Southern Bell case centers on political contributions made by executives in North Carolina between 1971 and 1973. In Atlanta, Southern Bell expressed disagreement with some of the FCC staff findings, including the claim that some executives were allocated funds for contributions.
In response to allegations of unlawful acts by another AT&T subsidiary, Southwestern Bell, the staff said there was no evidence of serious wrongdoing.