Ban sought on US phone company: MP wants AT&T refused British licence

A LABOUR MP is tabling a parliamentary motion opposing the entry into the British telephone market of AT&T, the US giant.

Peter Hain, MP for Neath, will argue that the US telecommunications markets must be opened to British companies before the Government grants AT&T a licence here.

AT&T applied on Thursday for licences to become a fully-fledged public telephone operator in competition with BT and Mercury. It said it had tried negotiating with BT on co-operation but found that the British company preferred to go it alone.

The US company also wants to operate an international service between Britain and the US based on leased lines. The Department of Trade and Industry has so far refused to issue any licences for these so-called 'simple resale' services to the US as there are no reciprocal arrangements.

Mr Hain wants a block on licences for foreign firms unless the issue of reciprocity is resolved. 'There is not the open competition we have here,' he said. 'I do not see why we should allow foreign companies to clean up in our market.'

BT has applied to offer international resale from the US, but no licence has been granted.

Mr Hain said the Government's stance on this would determine whether Britain could retain its position as one of the world's top telecommunications players. He is sponsored by the Union of Communications Workers, where he headed the research department for 14 years.

AT&T's detailed plans for the UK remain uncertain. The company would initially target multinational companies but has not ruled out offering a service to residential customers. Whether it would resort to building its own domestic network rather than leasing lines would depend on the terms offered by BT and Mercury for access to their networks.

Some analysts believe that AT&T's focus on larger customers would pose more of a threat to Mercury than to BT. One pointed out that the business customers Mercury had lured away from BT were price-sensitive and might be persuaded to switch again.

Mercury said that in anticipation of AT&T's application for licences it had already brought down all its international prices and expanded its residential services.