Bell Telephone System

The seven Baby Bell telephone companies are poised to sell their research cooperative Bellcore to a San Diego-based defense contractor for about $700 million, the Wall Street Journal reported Monday. The sale would end a jointly owned arrangement that began a dozen years ago with the breakup of the old AT&T empire. The newspaper said the sale of Bellcore to Science Applications International Corp., an employee-owned defense contractor based in San Diego, could be announced as early as this week.

The Senate's passage of a sweeping telecommunications overhaul Thursday was a big victory for the seven regional Bell companies because it would eventually free them to enter new lines of business. However, telecommunications revisions must also pass the House, and that chamber has a different bill, which long-distance providers such as AT&T Corp., MCI Communications Corp. and Sprint Corp. favor over the Senate version.

Now that he's left Larry Tisch's on-the-auction-block CBS to create a new multimedia network for Michael Ovitz and three of the seven Baby Bell telephone companies, Howard Stringer gets to experience a better class of rumor. "Funnily enough, I got a call at home from a studio chief this weekend--I won't give you his name--and he said, 'Congratulations.' I, of course, asked, 'What for?' 'For buying MCA,' he said.

Showing that compromise is possible on one of the most bitterly contested regulatory issues in all of American industry, a regional Bell telephone company Monday won Justice Department backing to begin offering long-distance telephone service. Atty. Gen. Janet Reno and antitrust chief Anne K. Bingaman endorsed a plan that would allow Chicago-based Ameritech Corp. to offer long-distance service on a trial basis in Chicago and Grand Rapids, Mich.

In its second major hiring in six weeks, the budding media venture formed by regional telephone companies Pacific Telesis, Nynex and Bell Atlantic has lured former Fox television executive Sandy Grushow to be president of its programming arm, it was announced Thursday. Grushow, who left as president of Fox Entertainment Group in September as part of a larger management shake-up, joins former CBS Broadcast Group President Howard Stringer at the as-yet-unnamed company.

The seven regional Bell telephone companies won approval Friday to offer long-distance voice and data services to wireless customers. The decision marks the first time U.S. District Judge Harold Greene has given the Baby Bells such broad ability to offer long-distance services, even though it is limited to wireless services and comes with strict conditions. The decision could thus be an important step for the Bells in their quest to enter the $70-billion long-distance market.

The seven regional Baby Bell telephone companies, increasingly divided over how best to capitalize on the booming telecommunications market, announced Thursday that they will put their powerful jointly owned research arm up for sale. The long-rumored move to sell Bellcore--which holds 439 U.S. patents, has a work force of 6,000 and generates about $1 billion in annual sales--comes after months of fractious infighting over how and when to put the Livingston, N.J.-based unit on the market.

The powerful regional Bell telephone companies, which had seemed to be on their way to profiting from a telecommunications reform bill that would open the door for them to the lucrative long-distance business, are suddenly facing significant last-ditch opposition.

Ever since they were formed by the 1984 breakup of the old AT&T, the Baby Bell telephone companies have been itching to move beyond the local territories they were created to serve and get into the lucrative long-distance business. And after years of litigation and Byzantine legislative efforts, the tentative agreement reached Thursday on a crucial piece of the sweeping telecommunications reform bill would finally let them do just that.

Rejecting efforts by long-distance carriers and others to maintain a substantial government role in policing phone competition, the House Republican leadership is moving to finalize a telecommunications reform bill, with a vote likely before the August recess. House Speaker Newt Gingrich (R-Ga.) and Commerce Committee Chairman Thomas Bliley Jr. (R-Va.