Utility regulators ponder US West Qwest merger

A consumer advocacy group wants US West Communications Inc. and Qwest Communications Inc. to reduce customer rates by $75.2 million if the companies' proposed $48.5 billion merger is approved.

Ken Reif, director of the Colorado Office of Consumer Counsel, said Monday he will seek the rate reduction as well as guarantees that US West's Colorado phone system won't be neglected if the two telecom giants merge.

US West spokeswoman Anna Osborn said the company would oppose any rate reduction as a condition of merger approval.

Colorado regulators on Monday began a series of hearings that will help them decide whether to approve the deal and determine if any conditions should be attached to the merger.

Because US West and Qwest should be able to reduce costs if they merge, passing those savings on to customers and improving US West's service problems are two major issues.

Qwest and US West officials declined to say how much money should flow to customers, arguing that savings estimates can't be guaranteed.

Reif said if the estimates are good enough for the companies to approve their marriage, they are good enough to calculate potential rate reductions for consumers.

Another area of concern is how quickly the companies would gain entry to long-distance markets. US West currently is prohibited from selling long-distance until it can prove its local markets are open to outside competitors.

Colorado regulators are expected to make a final decision on the US West-Qwest merger by early next year.

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