Year by Year: A Plan that Failed

(A Timeline of Pacific Bell’s “California First” Plan from the San Diego Tribune.)

Click to See Pacific Telesis Investor Fact Book pages, 1994–What Was Promised in California

November 1993: Pacific Bell unveils plans to spend $16 billion over seven years to upgrade its California network to handle interactive services like home shopping and compete against cable companies with video channels and movies-on-demand.

May 1994: (NNI NOTE: by 2000, 6 million households.) PacBell begins network construction in Pacific Beach and Mira Mesa in San Diego. Construction also begins in San Jose and in Orange and Los Angeles counties.

October 1994: City of San Diego considers proposal to require that Pacific Bell pay franchise fees and abide by other requirements imposed on cable companies if it gets into the video business.

October 1994: Pacific Telesis, Bell Atlantic Corp. and Nynex Corp. form Tele-TV, a joint venture to provide the companies with video programming, entertainment and information to sell to residents.

January 1995: PacBell and city of San Diego sign “landmark” agreement, with PacBell pledging to give the city 5 percent of gross revenues from voice, video and data services sold over new network. City agrees not to regulate PacBell as a cable company.

April 1995: PacBell buys Cross Country Wireless Inc. and announces plans to offer “wireless cable” service to 5 million-customer service area covering San Diego, Riverside, Los Angeles and Orange counties.

NN UPDATE: September 1995: Alternate Regulation is granted to Pacific Bell.

September 1995: PacBell slows network construction to save $1 billion in capital costs over five years for statewide project, but accelerates network construction in the San Francisco Bay Area.

January 1996: PacBell halts fiber/coaxial network construction in Los Angeles County. Network projects continue in San Diego, San Jose and Orange County (briefly).

April 1996: SBC Communications of Texas signs deal to buy Pacific Telesis.

May 1996: Network construction halted in Orange County.

June 1996: San Jose City Council awards PacBell a cable franchise, giving the company official standing as cable operator.

September 1996: PacBell begins selling video service in San Jose over its new network.

April 1997: SBC’s purchase of Pacific Telesis becomes final.

April 1997: Tele-TV, jointly owned by Bell Atlantic Corp., Nynex Corp. and Pacific Telesis Group, cuts staff in half and abandons all joint video projects in favor of individual company efforts.

May 1997: PacBell launches ‘wireless cable’ service in Los Angeles and Orange counties.

June 1997: SBC abandons almost all attempts to compete with cable, announcing immediate ends to Pac Bell’s video network project as well as a smaller test in Texas. The decision halts construction in San Diego and pulls the plug on 8,000 PacBell cable customers in San Jose. SBC writes off $500 million investment in both ventures.

November 1997: PacBell sends out requests for bids on various components of the partially built video network.

NN UPDATE: July 2001: The California ISP Association files formal complaint about discriminatory behavior.

Source: “PacBell’s video bid proving more costly,” Elizabeth Douglass, San Diego Union Tribune, Feb. 1, 1998, Page I-1.

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