SBC and AT&T Boards Vote to Go Ahead

telstar writes "As a follow-up to earlier coverage regarding the possible acquisition of AT&T by SBC, MSNBC is reporting that boards from both companies met to vote today and that the acquisition will go forward at a price of 16 billion dollars. Both companies are currently keeping the deal quiet."

Comments

Uh... dude

[Anonymous Coward]

Welcome to 1996

In February 1996, the soon-to-be-spun-off systems and technology unit of AT&T [includes Bell Labs] renamed itself Lucent Technologies and launched its separation with an initial public offering of stock issued in April 1996. The spin-off was completed in September 1996 when AT&T distributed its shares of Lucent to AT&T shareholders.

As a former Sprint Employee

[malus]

I can say that SBC is completely out of their minds for buying AT&T, a company which has been losing money, in the billions, for years. ... Perhaps SBC has a way to turn this around? I don't know, but I don't think so. I think the stock holders are going to be in for a rude, rude surprise.

As for Sprint? Hah. I would say in 6 to 8 months, you'll see Verizon buying them, assuming the Nextel deal goes through. If it doesn't? Sprint'll abandon it's wireline divisions, hurrah, and sell to the Germans.

Re:Bell Labs

[Suburbanpride]

My uncle was a pure researcher in the laser wing at bell labs from 1975-2001. Between 1996-2001 when lucent took over, his department went from over 250 people, to 100, to 50 and then to none. Lucent was interested in only keeping its stock price high (it didn't work) and not investing into research that might not be profitible until along time down the road.

Without an investment in research, american industry would be no where. and if everyone keeps cutting their R&d, I think the the Asian companies will put every american one out of business.

My uncle is currently working with a Japanese company, along with AMD to develop a ~50nm silicon etching process that may be profitible by 2010. Right now its a big money hole, but in 5 years, it could be the next big thing.

There is no creativity or risk taking going on at bell labs anymore.

Re:I feel a great disturbance in the POTS. . .

[UTPinky]

911 does have other meanings... In the US, 911 is the phone number to call in the event of an emergency (ie, need the police, the fire dept, an ambulence, etc), and has been for over 35 years...

http://www.911dispatch.com/911_file/history/911his tory.html

oh, and by the way... its a star wars (Obi-Wan Kenobi, episode IV) reference, not a matrix reference.

SBC really needs their LD Network

[Anonymous Coward]

SBC was approved in Nov 2003 to sell long distance services. Seeing as they don't have their own LD network currently, they need to buy one or build one. It way cheaper to buy an ailing company than build it out.

Currently they are reselling service from Wiltel, but obviously that affects the margins.

The Global services they're getting in the deal are just icing on the cake.

The 1984 Telephone Companies-- Where They Are Now

[SEE]

With the breakup of AT&T in 1984, the telephone market largely looked like the following:

Long Distance:
AT&T
MCI
Sprint
Qwest

Local Telephone:
Nynex (Baby Bell)
Bell Atlantic (Baby Bell)
BellSouth (Baby Bell)
Ameritech (Baby Bell)
Southwestern Bell (Baby Bell)
U.S. West (Baby Bell)
Pacbell (Baby Bell)
GTE (independent local carrier)

I mean, there were other minor players, but those were the biggies.

Today, if this merger goes through, these players are now parts of:

SBC (AT&T, Southwestern Bell, Pacbell, and Ameritech)
Verizon (Nynex, Bell Atlantic, and GTE)
Qwest (Qwest, U.S. West)
WorldCom (MCI)
Sprint (Sprint)
BellSouth (BellSouth)

Re:Let's not slide back. Or should we?

[drmerope]

"Having said that, when I lived in Houston (GTE then Verizon when I was there) I was always mildly amused to see that I had to pay a few cents extra for the privilege of having touch-tone dialing. Yes, touch tone dialing was an additional cost paid service."

The reason for this was regulatory. When the exchanges are upgraded to support services like Touch Tone or Caller-ID, every line supports those services--the capital cost is already sunk.

However, the tariff regulations did not permit the teleco to simply active said service and charge the extra cent per customer unformly--even though the capability was already there.

This was done because their was a congressional mandate to keep the cost of basic POTS service low--and infact often below operational costs. Thus, the oddity of being charged for touch-tone service. It was a little congressional welfare tax snuck into your telephone bill to keep the minimum cost low.

Re:AT&T's name?

[Rob Wilco]

My understanding is that AT&T no longer stands for American Telephone and Telegraph, and that the board actually voted to drop that association a while back, "post-acronym."