AT&T-BellSouth Merger Needs Safeguards CCIA Says

File Under: 2006, AntiTrust, Telecommunications

Oct 17, 2006

WASHINGTON, DC - The Computer & Communications Industry Association (CCIA) expressed disappointment today over the Justice Department’s (DOJ’s) failure to seek antitrust safeguards in the pending AT&T-BellSouth merger. The DOJ approved the largest merger in telecommunications history without requiring any of the conditions the Department has imposed o­n much less significant mergers in the past. The Federal Communications Commission (FCC) now needs to stand up for the nation’s consumers.

CCIA welcomes the FCC decision to allow public comment o­n AT&T’s proposed conditions. CCIA hopes the rest of the process will be transparent and allow sufficient time for meaningful public input.

"The huge potential ramifications of this merger o­n competition and consumer welfare in the telecommunications market should be considered without regard for political expediency," CCIA President and CEO Ed Black said. "Independent regulatory agencies like the FCC should not be pressured to hastily approve the AT&T-BellSouth before November elections. Indeed, a bi-partisan group of Judiciary Committee members from both House and Senate recently expressed their concerns about this case in writing. Consumer protection and the merits of this proceeding alone should drive FCC action. "

A combined AT&T-BellSouth would greatly accelerate the trend of consolidation in the telecom marketplace and would move the U.S. backward towards the days of AT&T’s monopoly. If the merger were approved, the top three telecommunications providers would control 49% of the national market. Likewise, most consumers in the BellSouth and AT&T regions would be left with few viable alternatives for basic telecom services or broadband.

At the very least, the FCC should seriously investigate placing competitive checks o­n this new telecom behemoth. Strong consumer privacy protections, enforceable net neutrality rules, spectrum divestiture and warehousing curbs should be among the measures contemplated. It is essential to the future of the U.S. telecommunications market that regulators take action to promote dynamic competition and consumer protection.