May 4, 1995


SEPARATE STATEMENT 
OF
                               COMMISSI                     ONER SUSAN NESS


Re:     NYNEX Telephone Companies' Petition for Waiver; Transition      
        Plan to Preserve Universal Service in a Competitive Environment


    Today, based on changing competitive conditions in New York City and
Long Island, we grant NYNEX a limited waiver of interstate access charge
rules.  I wholeheartedly support this decision.  

    Our action today demonstrates our steadfast determination to promote
local competition at every opportunity.  The Commission has expended
considerable time and energy in the effort to bring competition to the local
delivery of multichannel video programming, via video dialtone.  We also seek
to encourage competition in local telephone services.  The waivers we granted
last month for Rochester Telephone represented one modest contribution on our
part to the development of a more competitive local telephone marketplace. 
Today's action is another timely step forward.

    This decision also illustrates our responsiveness to changing
circumstances.  We must not let our hopes distort our perception of realities,
but genuine and substantial marketplace changes should be accommodated with
corresponding measures of regulatory flexibility.  In this instance, we are
waiving our rules upon a compelling showing of special circumstances, based
on our assessment of the present market conditions and future prognosis for
competition in LATA 132 -- and our confidence that consumers throughout
NYNEX's service area will be protected against negative impacts. 

    Our decision today is testimony to the importance of cooperation in the
construction of a new competitive framework.  The New York Public Service
Commission has shown extraordinary leadership in creating conditions for
increased competition.  NYNEX has embraced change instead of fighting it,
allowing competitors to collocate their equipment in NYNEX's offices and
successfully negotiating mutual compensation and other complex issues with
several competitive service providers.  Those providers have relentlessly sought
to accelerate the pace of change -- and to make the benefits of competition more
widely available.  I applaud them all.

    The significance of today's ruling should not be overstated.  Our action
here is an individualized waiver, not our final blueprint for the transition to
competition.  Even in the New York marketplace, barriers to competition still
remain, and robust, sustainable competition is not yet guaranteed.  Accordingly,
we will need to monitor closely the results of today's action in LATA 132 --
and improve our tools for assessing when competitive developments in other
markets may justify waivers or rule changes.

    As we continue our focus on local competition, we must remain attentive
to the interplay between competition and universal service.  Competition brings
lower prices and increased choices for consumers (among other benefits), and it
can thereby help us fulfill our universal service responsibilities by making
services more attractive and accessible.  But in today's environment universal
service depends on subsidy flows that will not be altogether sustainable in a
changed environment.  We therefore need to reevaluate our universal service
objectives and mechanisms in light of emerging competition, and we are doing
just that within this agency and in collaborative efforts with state regulators and
the National Telecommunications and Information Administration.  

    Meanwhile, we must press relentlessly forward with efforts to promote
competition, as we are doing today.