February 22, 2002 -- Debt and deregulation could have a tremendous impact on the future of the competitive telecom industry, George F. Schmitt, chairman and acting CEO of e.spire Communications Inc., told attendees of the "Breakfast of Champions," a networking event sponsored by the Competitive Telecommunications Association (CompTel).

Schmitt, who has been leading e.spire as it attempts to exit bankruptcy, expressed his concern about the amount of debt that competitive telecom carriers have been carrying. "It's not that [competitive providers] are not good enough, they have to clean up their balance sheets," he said.

While dealing with mountains of debt remains a problem, the most pressing concern for competitive providers, said Schmitt, is the proposed Tauzin-Dingell bill (H.R. 1542), which would allow the Bell companies to skirt their obligations under the Telecommunications Act of 1996.

"This country cannot have a law that would allow the BOCs to become an unregulated monopoly," he added. "It's going to be a struggle if the bill gets through. The bill has hurt our ability to get money and has hurt other companies that are trying to get funding." Schmitt and other industry executives have been meeting with members of Congress to explain the devastating effect Tauzin-Dingell could have on competition and the economy, should the bill be voted into law.

Despite concerns about the Tauzin-Dingell bill, Schmitt said he believes the future is bright for competitive providers who can clean up their balance sheets, stay out of debt and serve customers. "We put products out there that people will buy. We've introduced new and innovative products," Schmitt said. "Technically the Bells can do what we do, but you don't see them offering the kind of integrated products that the CLECs offer."

-End-