U.S. DOJ Moves To Block MCI/Sprint Merger

Janthkin writes: "It seems the U.S. isn't going to allow MCI and Sprint to merge after all, so they WON'T be creating 'a telecommunications and Internet giant, one that would carry more data traffic than any other carrier and that would have left the U.S. long-distance market with only two major competitors instead of three.' (Text from the Standard story here). CNN coverage here." The U.S. side of the merger is not completely ruled out, but this seems a strong blow against it.

Comments

Oh, the irony

[J4]

Wasn't it Craig McCaw from MCI that instigated the antitrust suit against AT&T back in the day, so that MCI could enter the long distance market?

Go figure.....

Re:55 Hours a week?

[GossG]

A long time ago, a revolution was fought with bullets and billy-clubs against people fighting for fair work rules.

One of the results of that was a 44 hour work week, that rapidly became 40 hours blue-collar or 37.5 hours white-collar.

If you want the money, sure. Work the clock around and fry your brain in the effort. But don't make sweatshops the "standard" work week.

With twelve years of corporate IT experience, I get less than Cdn $50K. But I work 37.5 hours. Anything over 7.5 hours in a day is overtime. Anything over 11 is double. Anything on the SECOND weekend day is double. A call-in counts as 3 hours. A phone consultation that doesn't need a trip in counts as at least one hour. Coffee and bottled water is free. There's a fairly nice fitness room that I should use more often.

I feel that my employer respects me, despite the low salary. And I think that these conditions should be considered an obtainable goal for other people who would prefer that their employer respect them.

At the 5 IT environments I've worked at over the years, I've never worked free overtime. (well, except for the volunteer job...) I'm not sure I would.

I made the choice to drop consulting in order to get the work rules of a company that treats me fairly.

(Ho God! After my right-wing youth I've become a union organizer????)

Large companies are the new government

[TheSacrificialFly]

These large companies will in the very near future be as powerful, if not eventually totally replacing, individual governments, because they have one ability governments don't have: the legal right (ie. no war necessary) to expand worldwide.

This scares me.
tsf.

Re:Large companies are the new government

[edhall]

For instance, they often times have to hire, promote and train often times based upon color or sex rather than skills.

"Affirmative action" only affects companies who contract with the government, and is hardly universal even then. It's usually been fairly toothless, with a few notable exceptions. You may be referring to antidiscrimination laws that affect almost all companies above a certain size, but these merely prohibit hiring/training/promoting based on specific things other than skills and experience -- a different thing entirely than what you imply.

They have to pay the lionshare of taxes in the US - [which they pass on to us no doubt]

Large companies actually pay proportionately less in taxes than small companies and individuals, leading to such absurd situations as one of the largest and most profitable companies in the US, General Electric, paying no income taxes at all.

They have to comply with often time, arcane rules for ergonomics and safety set for them by a department with nothing better to do. [Nothing funnier than seeing the local Bell rep in a hard hat in our equipment room. Look out for those falling bits!]

I'd agree with you if service reps only had to work in the semi-office environment of the typical machine room. But data and telephone infrastructure is hardly limited to environments such as yours; they can be every bit as dangerous as construction zones -- and frequently they are construction zones.

As for the larger issue, until you've worked on a line and seen the sorts of things employers try to get away with in terms of safety and working conditions, you've no ground on which to criticise the bulk of what OSHA does. Visit a data-entry facility if you want to see just why some rules might be required for keyboard workers -- they are veritable sweatshops with computers. It may seem a little silly when they get applied to software developers -- but then again, having known several with work-related repetitive-stress injury, perhaps the rules aren't quite so "arcane" for us either.

They have to, without question, deal with and support unions.

You're pretty young, aren't you? Union clout these days is miniscule compared to what it was twenty or thirty years ago, with about a third the members today as then and whole industries de-unionized. Unions currently are weaker in the US than in any other industrialized nation, without doubt.

It takes an act of Congress, literally, for them to do business outside of our borders.

There's this thing called the US Constitution that requires Congress to do this. But I've not noticed this little fact putting much of a crimp in the sails of multinational corporations lately, have you?

In brief, I don't know what broadsheet you copied the above "facts" from, but they show a pretty short-sighted view of the situation. Study the history of US industry from the late 1800's to the start of the depression and you'll see an eerie picture of what happens when corporations increasingly rule the US. Perhaps you'll gain a little appreciation for why the government is involved in the affairs of corporations today.

-Ed

Too bad...

[hayz]

I was kind of hoping this merger would go through -- it would have decreased the number of annoying telemarketing calls to my phone by *at least* 50%. This is clearly an instance where the anti-monopoly law fail to serve the public interest. Heh.

Corporate progress

[Stiletto]

Corporate progress should not be at the expense of ordinary citizens and/or small business. That's why the government steps in when "shady" stuff starts to happen.

I don't mind if it's an expensive legal battle, as long as a message is sent to these huge corporations: That they can't grow to the point where they threaten the public good.

The merger is off

[Randy Rathbun]

According to the local media here in Kansas City, the world HQ for Sprint, the merger is off.

The Kansas City Star is saying that while the executives are all really glum, the employees have been celebrating.

I don't work for Sprint, but I am glad this is off as well. Even though all through this the executives were saying "We are not moving if we merge," everyone knows otherwise. It happened to Marion Labs, it would have happened to Sprint as well. That would have been a huge hit on the local economy beings that Sprint has 24,000+ employees in this town alone.

WorldCom is poised to become a monopoly

[Anonymous Coward]

In 1998, being a hacker fresh out of college with sheepskin in hand, I received a job at MCI. My background was information security; MCI was interested in me for that, but the unofficial corporate policy was that everyone in the UNIX development team (which InfoSec was part of, don't ask me why) had to spend six months in an unrelated IT field.

It was a reasonably sensible requirement; it ensured that everyone in their InfoSec department had experience with the company's IT infrastructure and it would give the InfoSec group a large skill pool to draw upon. So I took the first job I could get in their IT department, intending on getting a transfer in six months. I wound up as (gasp, horrors) a mainframe QA engineer.

MCI was finishing up the MCI-WorldCom "merger". Don't let it fool you--it wasn't a merger at all. MCI was bought, lock stock and barrel. Bernie Ebbers (the chief of WorldCom) took control and the bloodletting began. In the space of one afternoon, my department lost about a quarter of its headcount. The guy in the cube next to me received his termination notice via email--at ten o'clock in the morning he was fired, and by one o'clock that afternoon he was gone.

We survivors were told that there would be no more layoffs for (I forget--several months). Not too much later, a few weeks, I noticed that a lot of our workforce was all leaving the building at the same time, carrying boxes of stuff. Bernie Ebbers kept his promise--there weren't any layoffs that day. It was just that a few dozen contractors were informed that their contracts would not be renewed, even though they were desperately needed for the success of the projects they were working on.

The corporate culture changed dramatically. The work week was 36 hours when I arrived there; MCI corporate management felt it was important to keep its engineers happy, so they gave us Friday afternoons off. After the WorldCom merger it shot up to 40, then 44 hours; at one point (in mid-1999), my manager told me that the company was expecting 55-hour weeks from me for the next six weeks. Y2K work and all.

Between the constant threat of layoffs, the punishing working conditions, the lack of respect from management, the uncertainty surrounding WorldCom's intentions for MCI and everything else, I decided to get the hell out of Dodge.

It just wasn't worth it for $38,760 a year.

Lesson here: WorldCom is not a friendly business. If this buyout of Sprint is anything like the MCI buyout, Sprint will be decimated in order to make sure it gets in line with WorldCom. This will hurt consumers; it homogenizes the market and stifles the competitive spirit that makes the marketplace go 'round.

While I was at MCI, we were strongly motivated to get the cool stuff done before Sprint could beat us to the punch. It was one part profit motive (stock options) and two parts ego (we wanted bragging rights). It was an effective way of getting us to work hard, and in the end, the consumer benefited.

If the DOJ hadn't stepped in, MCI would have become Sprint, and a lot of that fierce competitiveness would have gone away.

WorldCom is growing far too large, far too quickly. Sometime look at just how many telecommunications companies they've bought out in the last ten years.

-- I'm posting anonymously not because I'm an AC, but because I don't want to get sued by WorldCom. I don't know if they'd sue or not, but considering how draconian their nondisclosure policy was right after the MCI buyout, I'd rather play it safe rather than sorry.

T-1000

[Seumas]

All I can think of when it comes to telephone companies is the T-1000 in Terminator2:Judgement Day.

You keep hacking at it; splicing it; chopping it up; melting it; freezing it; splitting it up. Nothing works. At best, you manage to break it into dozens of small chunks, but before you know it, they've instinctively re-assimilated into the original unstoppable body of the T-1000.

I'm tired of dealing with phone companies. They're one of the few commercial (non government) entities who really could care less about their customers. They don't even attempt to convey the appearence that they care about you. Just give them your money, shut the fuck up, and they'll get around to establishing your phone service when they are good and ready.
---
seumas.com