FCC TELLS SBC TO EITHER PAY $1M OR SELL SECURITYLINK

NEW YORK

Telecommunications giant SBC Communications Inc. announces it has agreed with the Federal Communications Commission (FCC) to either sell security and fire detection division SecurityLink or pay $1 million to the U.S. government. The decree from the FCC stems from alleged violations of the 1996 Telecommunications Act by Ameritech Corp., a Chicago-based unit of SBC that owns SecurityLink. San Antonio-based SBC says it was ordered to either form a pact to sell SecurityLink by Feb. 9, 2001, or pay $1 million to the government.

The Telecommunications Act of 1996 mandates that local telephone providers could not enter into the alarm monitoring business until 5 years after the act was approved, or in 2001. Ameritech already owned an alarm monitoring unit, SecurityLink, at the time the bill was passed and was permitted to retain that unit. But, in 1996 and 1997, Ameritech acquired and added new alarm monitoring assets to the SecurityLink division. The acquisitions led to the FCC’s findings in 1998 that Ameritech was in violation of the act. The new decree is aimed at ending the dispute. A representative from SBC declined to comment on the alleged violations, however, the firm did say it anticipates the announcement will have no material effect on shareholders.

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