File No. 70-8715
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-1
Amendment No. 2
to
APPLICATION OR DECLARATION
under
The Public Utility Holding Company Act of 1935
THE SOUTHERN DEVELOPMENT AND INVESTMENT GROUP, INC.
64 Perimeter Center East
Atlanta, Georgia 30346
(Name of company or companies filing this statement
and addresses of principal executive offices)
THE SOUTHERN COMPANY
(Name of top registered holding company parent
of each applicant or declarant)
Tommy Chisholm, Secretary
The Southern Company
270 Peachtree Street, N.W.
Atlanta, Georgia 30303
(Name and address of agent for service)
The Commission is requested to mail signed copies of all
orders, notices and communications to:
W. L. Westbrook J. Kevin Fletcher
Financial Vice President President
The Southern Company The Southern Development and
270 Peachtree Street, N.W. Investment Group, Inc.
Atlanta, Georgia 30303 64 Perimeter Center East
Atlanta, Georgia 30346
John D. McLanahan, Esq.
Troutman Sanders LLP
600 Peachtree Street, N.E.
Suite 5200
Atlanta, Georgia 30308-2216<PAGE>
INFORMATION REQUIRED
Development hereby amends and restates the third paragraph
of Item 1.4 - Purpose of Investment (as previously amended and
restated in Amendment No. 1) to read as follows:
"Southern Communications Services, Inc. ("Southern
Communications") and ITC's wholly-owned subsidiary, IFN, have
entered into a long-term agreement pursuant to which IFN is
providing interconnection, switching and system integration
services between Southern Communications' Enhanced Specialized
Mobile Radio ("ESMR") network/1 and the public switched telephone
network. The interconnection utilizes the excess capacity
associated with an existing IFN fiber optic link into the Alabama
Power Company headquarters building in Birmingham where Southern
Communications' central switching facility is located. Using
this link, Southern Communications is able to digitally transmit
call traffic to and from the public switched telephone network
without having to make any additional capital investment of its
own./2 Thus, all interconnected calls which originate on the
public telephone system (which includes cellular call traffic)
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1 See The Southern Company, Holding Co. Act Release No.
26211 (Dec. 30, 1994).
2 If Southern Communications had to duplicate the existing
IFN facilities, it would entail additional expenditures in the
millions of dollars. Alternatively, Southern Communications
could lease circuits from unaffiliated interexchange carriers.
However, the arrangement with IFN permits Southern
Communications' interconnected traffic to share facilities with
other traffic handled by IFN, improving economies of scale and
resulting in lower overall costs to Southern Communications than
would be incurred if Southern Communications were to lease its
own circuits.<PAGE>
are routed into the ESMR switching system at the Birmingham
interconnection point. Likewise, all interconnected calls
originated on the ESMR network can be terminated in the local
telephone exchange maintained by IFN's affiliates (if that is the
call destination) or, alternatively, routed by IFN to the local
Bell operating company ("BOC"), to other independent telephone
companies, or to any one of the major long-distance carriers with
which IFN or its affiliates are already interconnected.
In addition to making use of the redundant (and therefore
reliable) capacity associated with its existing Birmingham fiber
optic link, IFN is uniquely positioned to provide Southern
Communications with the important advantage of having a single
point of interconnection with the public switched telephone
network throughout the Southeast./3 This advantage derives from
IFN's affiliation with an independent local telephone exchange
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3 An important feature of the arrangement with IFN is
that it will allow telephone users to make toll-free calls to
Southern Communications' customers from any location within the
Southern Communications' service area. This will provide the
Operating Companies with greater control and predictability in
the costs that are associated with calls from the public switched
telephone network to Southern Communications mobile units. For
the same reason, it is expected to provide a marketing advantage
in Southern Communications' dealings with unaffiliated mobile
radio customers. While it is possible that Southern
Communications could implement such a regional inbound toll-free
call arrangement through direct links with each of the 100 or
more independent telephone companies in its service area, the
single interconnection with IFN and its affiliates, which are
already connected to each of those independents, eliminates a
layer of complexity and associated cost.
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system located in the heart of the Southern System,/4 as well as
from IFN's existing fiber optic network throughout the Southeast
and its (or its affiliates') links with all of the major long-
distance carriers.
The efficient and effective planning and execution of this
interconnection agreement is essential not only to Southern
Communications' future plans, but also to maintaining the
reliability and cost-effectiveness of the wireless services that
Southern Communications will provide to the Operating Companies."
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4 Under the consent decree that led to the break-up of the
former AT&T Bell telephone system, the United States is now
divided into "Local Access and Transport Areas," or "LATAs."
Each of the Bell operating companies, or "BOCs" for short, are
now limited to providing services within LATAs. See United
States v. Western Electric Co., 552 F.Supp. 131 (D.D.C. 1982),
aff'd 103 S.Ct. 1240 (1983). As a result, in order to permit
customers of Southern Communications to send and receive calls to
and from customers of BellSouth Telecommunications, Inc., the BOC
serving the geographic area in which Southern Communications
operates, it would be necessary for Southern Communications to
interconnect with BellSouth's facilities in each of the fourteen
(14) LATAs in the Southern System service area. IFN and its
independent telephone affiliates, however, are not subject to
this restriction. Thus, one of the important features of the IFN
interconnection agreement is that it shifts to IFN the
responsibility for delivering public network traffic to and from
each of the 14 LATAs.
-3-<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned company has duly caused this
statement to be signed on its behalf by the undersigned thereunto
duly authorized.
Dated: December 29, 1995
THE SOUTHERN DEVELOPMENT AND INVESTMENT
GROUP, INC.
By: /s/Tommy Chisholm
Tommy Chisholm, Vice President and
Secretary
-4-<PAGE>
