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New AT&T Acquires BellSouth
spune writes "Only months after SBC's acquisition of AT&T last November, the newly rechristened telecom has announced that it plans to buy fellow Baby Bell BellSouth Inc, of Atlanta, Georgia for $67 billion. This action by AT&T will consolidate more than half of the original Bell System into a single entity, leaving only Verizon and Qwest as remaining Bell family competitors. Analysts predict this deal will be approved by the FCC with only minor restrictions on the new company, which will serve residences and businesses from California to Florida."
Of the original breakup anyway? The baby bells are buying each other and Ma bell.
--- http://davidnehme.blogspot.com
Give it a year or two, and Ma Bell will be back, only without the cool bits this time (Bell Labs).
Well, in English, we have certain things called "tenses."
Tense is generally used to indicate a timeframe relative to the present when something happened, is happening, or will happen.
Notice how in the article, they state that AT&T is planning on acquiring Bellsouth. If you read further, you'll notice other sources say the FCC approval process could easily take around a year.
Because, if this is going to happen, it will be happening in about a year, saying "AT&T acquires Bellsouth" creates a tense error, and if you want to really get technical, yes, it is a fairly big deal especially if you consider how significant the error is.
The inverse of that worked pretty well for the antitrust Microsoft trial.
Any program relying on (nontrivial) preemptive multithreading will be buggy.
Just like before the breakup...minus regulation.
It does bother me quite a bit that they will have near total control of the DSL market.
Freedom is merely privilege extended unless enjoyed by one and all.
The prevailing thought in the anti-trust/economics literature is that consolidation is generally regarded as a good thing in cellular..
Basically, there are massive density economies in delivering cellular service (e.g. it's better to use a higher percentage of the capacity of one expensive tower vs. having four separate expensive towers running at lower utilization rates), and as such, there are efficiency gains that can come out of such mergers. We're more likely to see continuing consolidation in national cellular markets with a much bigger space for international competition. The companies want to move forward with consolidation, and the anti-trust authorities aren't really standing in their way.
In the US, the anti-trust people really only care about post-merger consumer prices (rather than the increased profitability of the merged entity). The degree of substitutable goods and the nature of price competition in cellular markets seems to keep downward pressure on rates. This is why they are letting all this go through.
As for VOIP (and the greater economy), you only need two firms to get good competitive results from these types of goods. Landline phones and VOIP are essentially homogenous products, and as such, it's perfectly logical to assume that people will go with the firm that offers them the best price/quality ratio. Outside of collusion, odds are good that you will see competition putting downward pressure on prices in landline telephony even if both landlines and VOIP are delivered by monopolies.
The only thing I would disagree with in your comment is that only the government can grant monopoly status; An already established monopoly (established, perhaps, by being the first implementer of a new technology) doesn't need government support to maintain its position, especially in areas where entry costs are high. In these cases the monopoly can often drive new competitors out of business by operating at a loss long enough to ruin the competitor's finances. In reality, of course, the collusion of government is often bought to support the monopoly since that's a cheaper way to go about it. But sometimes it's just the opposite, and government intervention is required to overturn a monopoly that has established itself by choking its competition in the free market.
Judge Green must be rolling in his grave.
Less competition = less push for innovation, higher prices, and every reason Bell was broken up in the first place.
No, it was broken up because of an antitrust suit brought by MCI. The sad part was that AT&T was one of the most innovative companies in the world. Witness the transistor - a Bell Labs product. If anything, the monopoly hurt them because they were not (because of regulations) allowed to take advantage of their innovations outside of the telephone market.
What they did have was something that's been dropped - service. You needed a phone installed, it was done, and done quickly. Have a problem? Fixed. Need to talk to someone about an issue? There was someone on the end of the line. Compare that today's "advantages". Need a phone installed? Wait a week or two. Got a problem with your line? Maybe they'll get around to fixing it in the next month. Have a problem with your bill, or need to talk to someone about an issue with your phone service? Welcome to the support hell of pushing buttons, listening to recorded messages, pushing more buttons, and maybe at the end of it you'll get to talk to someone who may speak English. (sarcasm) Oh yeah, we're so much better off!(/sarcasm)
Except VOIP depends on internet service, which is provided by the phone company competing with that VOIP...
While you make an elegant argument, you forget that AT&T will control a significant portion of the DSL market, which would allow AT&T to set forth the same anti-trust/anti-competitive behavior (by filtering VoIP data).
Not to mention AT&T would then have control of the bigger half of cellular customers in America (Cingular/AT&T Wireless). The last step would be their re-acquisition of Verizon (which would be epic at this point, as Verizon just acquired MCI, which was one of the companies AT&T flagged as a "competitor" in their earlier anti-trust proceedings).
So as a consumer, I can see this leading down a very dark road for consumers.
"Victory means exit strategy, and it's important for the President to explain to us what the exit strategy is." G.W.Bush
You need to lay an entire network to compete with an established phone company. The phone company you're competing with already has laid, and paid for, that company. So while you take twenty years to build your network and 40 to recoup your investment, you'll be somehow raising that money from customers who have the choice between your network, and the cheaper incumbent.
How the FUCK do you compete with that? Are you on the same planet? There's absolutely nothing whatsoever you can do. If you promise "better service", the incumbent has plenty of time to improve their services. If you promise enhanced features, the incumbent can roll that out to all their customers before you've laid the lines in a single street.
This isn't a myth. It's real. It's why nobody's building fully competitive networks, even in countries where it's encouraged. In Britain, the only competition was from cable TV companies, who were only able to get their networks built because BT was banned from selling television services. And I've never heard of someone asking to build a competing network and being told "no" by any American government. Why? Because nobody wants to.
The only "competition" we'll see in the short term is from the cable companies. In the long term, we don't even know for sure that the cable companies and the telephone companies will not merge anyway. And we already know that a duopoly isn't enough to ensure buyer-focussed products.
We need regulation. And we cannot wait for libertarian utopias to be proven idiotic, especially since I've never come across a libertarian who hasn't find something government related to blame any failure of deregulation upon. The wires should work for us.
You are not alone. This is not normal. None of this is normal.
The 1981 breakup gave the Baby Bells "local dialtone" and big AT&T (and others) "long distance." Now that the technology has all changed, this line of demarcation is obsolete.
It's time for another breakup, and this time it should go as follows: the RBOC's (soon to be the One Big BOC) maintain the physical cable plant, and they maintain the central offices basically as colocation facilities. Then, you have carriers (none of which are allowed to be RBOC's [or the imminent One Big BOC]) as colocation customers in those central offices. They lease customer loops from the BOC/LEC/whatever and then they provide "telecom services" over those loops. We don't care what the services are -- dial tone, DSL, whatever. No distinction between voice and data, between local and long distance, whatever, because as we know, it's all the same crap now.
THAT is the perfect way to keep the government-granted monopoly working efficiently for consumers. The monopoly must extend only as far as it needs to, and no further.
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Not even close. The biggest thing is competition in the local phone market. Now the copper-loop provider competes in more and more markets with the cable provider, and is starting to compete with the power provider. Soon new providers may be offering Wireless Local Loop. AT&T also is far from having a monopoly on long-fiber: gas companies, power companies - even Google - have that stuff. It is this type of inter-modal competition that means it makes sense to merge. You have to bulk-up to compete. Not merging would be suicide.
At the end of the day, it is very likely the consumer will buy all of their communications products (voice, video, data, and mobile) from a single provider, and competition will be in the bundle. If providers don't offer all four, buying from them will make about as much sense is a buying from a car maker that sold the entire car minus the wheels and seats.
It is in fact de-regulation and intense competition that make this move necessary.
Sarcasm and hyperbole are the final refuges for weak minds
Bush is the president - responsible for running the country. The cruel irony is that Bush can be described only as irresponsible.
Bush was warned about Katrina's risk of flooding New Orleans, went on vacation instead, and resurfaced long enough to lie about no one anticipating the levees would fail.
He was warned about Global Warming, and instead has his administration gagging NASA scientists while presiding over the biggest increases in Greenhouse emissions ever. Now the ice is melting even faster than the scientists predicted.
Bush took office with Microsoft ruled a monopoly, and his Justice Department let them continue unabated. The years since have seen continuing abuses, but only foreign courts are doing anything about it, because Bush won't do anything to protect the market. A market that has remained unsafe for new competitors during his stewardship.
Bush was warned that Iraq would collapse into civil war, and now acts like its just a nasty surprise - while he isn't denying it's happening. He got a daily intelligence brief titled "Bin Laden Determined to Strike in US", after repeated warnings from Clinton's outgoing team and Clarke, the counterterrorism administrator who stayed on. Then he acted surprised when his deprioritization collected the 9/11/2001 planebombings. He was warned before N. Korea got the bomb, before Iran got the bomb, that cutting taxes on the rich would keep the regular economy moribund, that screwing with the Mideast would keep oil prices sky-high.
So maybe you know something about Bush and the Superbowl that we haven't heard yet. Anonymous Cheney, is that you? Shouldn't you be at target practice, or something?
--
make install -not war
What the hell did they break up Ma Bell for if they are just going to let it corporate merge itself back together?
How ya like dat?
Comment removed based on user account deletion
The trick is that AT&T was broken up BECAUSE of the TYPE of regulation they were under. When AT&T created a "phone system" (Panel, Crossbar, ESS), they designed it for at LEAST 20 years. 20 years ago we were amazed by the "New 386". This was mostly the result of the regulated ROI. Yes they made things to LAST, but they HAD to. They NEED to have a good incentive for FASTER turnover, MORE innovation. MCI and Sprint came along and sold only to the lucrative long distance market, AT&T's bread & buttter. The Long distance market used to help PAY FOR local service. It was set up that way. When the lawsuits started piling up against AT&T, Charlie Brown decided "forget it". He took the chance that the "Bell Children" would be profitable because they would be mostly deregulated. He was right.
This does not mean that "the New AT&T" will do us any good. Without SOME sort of regulation, we're done for. ALSO, you all forget that Verizon *IS* the other "BIG" comprtitior --> GTE. And YES, they are "fated" to merge. Eliminating ALL "big" phone companies, and getting back to one. But we NEED them to be REGULATED. SERVICE was ALL the old AT&T cared about. It was 1,2, & 3 of the top five things they worked toward. We also have to let them make money off their inventions. The old rules did not allow that.
The key to all of this is creating regulation that REWARDS innovation. Bell labs did the transistor, the first work on disk drives, the LASER (independently, but later than Gordon Gould), TELSTAR, and on and on. Without the proper fiscal incentives, innovation will "not be worth it", from THEIR point of view.
Without innovation, we ALL lose, BIG-TIME.
I think this can be a good thing, if we do it right. I also think it is inevitable. The ONE thing we have to LOSE if the 1980's mentality. Greed is NOT good. If we have a single Bell system, and pay the CEO $100 MILLION a year, we are done for. [By modern scales the CEO of the largest company in the world is worth $100 Mil. We cannot have that kind of thinking.]