IP Convergence: Beyond VoIP, Beyond Cost Savings

The FCC has put out for Public Comment at&t's acquisition of BellSouth. Comments are due June 5th and reply comments are due June 20th.

Historically, the competitive telecommunications industry has expended tremendous resources challenging Bell Company mergers beginning with SBC's acquisition of Pacific Bell in 1997. Challenges continued against Bell Atlantic's acquisition of NYNEX, also in 1997, SBC's acquisition of SNET in 1998, SBC's acquisition of Ameritech in 1999, and Bell Atlantic's acquisition of GTE in 2000. In all of these cases, the arguments put forth by the competitive industry were given short shrift and the acquisitions were approved with only marginal conditions that the government had no interest in enforcing. This unwavering support for the Bell Companies' ambitions peaked with the approval of SBC's acqusition of AT&T and Verizon's acquisition of MCI last year. Of course, the one significant merger between two competitive carriers - Sprint and MCI - was blocked in 2000 as being anti-competitive.

The FCC and the Department of Justice are now poised to approve yet one more merger between the Bell Companies. And you can be sure that once again the concerns of the competitors will be given short shrift. Rather than spend the enormous resources it takes to effectively challenge these mergers, parties should consider sending in the following statement:

"For all the reasons stated over the past ten years, we continue to oppose these sorts of mergers between the Bell Companies. But since you won't listen to our concerns we only ask that you stand accountable for the inevitable decline in innovation and productivity, the loss of consumer welfare, and the price increases that are going to result from your approval and encouragement of a telephone duopoly. The notion that fewer companies translates into more competition is too Orwellian for us to accept, but we do not have the resources necessary to convince you otherwise."