MCI customers should stay put for now, expert says

By Jon Swartz
USA Today

SAN FRANCISCO — Jittery MCI customers have nothing to fear. For now, at least.

Despite a financial implosion that could land MCI's parent company, WorldCom, in Bankruptcy Court, the long-distance service will continue unchanged. The challenge for customers, telecom lawyer Brian Moir says, is picking up danger signs and changing carriers before it's too late. Here is some expert advice:

Q: What should customers do?

A: Nothing immediately. WorldCom's high-quality communications network will not self-destruct overnight. But customers should keep an ear out for troubling signs. WorldCom's layoff of 17,000 employees last week could eventually hurt customer service. Neglect of phone service could lead to busy signals, crackling lines and aborted calls. And WorldCom could be forced to increase prices to offset a cash crunch. If any of those occurs, "it's time to jump ship," says Gene Kimmelman, a director of the Consumers Union advocacy group.

On the flip side, WorldCom could drop prices to attract customers and boost the company's revenue. "There is a potential silver lining to this mess," Kimmelman says.

Q: How many people use MCI?

A: About 20 million subscribe to MCI's long-distance service. An additional 2 million use its local service, and 2 million have wireless accounts. About 50 percent of all corporate communications in the United States travels over WorldCom's network, as do 30 percent of consumer long-distance calls. WorldCom also provides Internet "backbone" connections for America Online.

Q: Are WorldCom's rivals offering deals to its customers?

A: Not yet, but rival SBC Communications is expected to dangle bargains soon. Meanwhile, telephone companies such as BellSouth and Verizon, which are branching into long-distance service, are actively courting WorldCom customers in their states. "The regional companies are really pushing marketing tactics that appeal to fear and uncertainty," telecom analyst Jeff Kagan says.