AT&T To Buy BellSouth

25 thoughts on “AT&T To Buy BellSouth”

  1. Oh, like this REALLY comes as a big surprise?

    This is just what may have happened in 1997 when SBC wanted to buy AT&T and BellSouth was in the mix then and in 2001 dropped it.

    So the question is, what is different now than in 1997 and 2001, as to let these mergers go through when back then it was not approved?

    Do you really think AT&T divestures of its cable and wireless units were not a grand plan to make the future mergers
    easier?

    This was a setup in the making for many years, in just that the 1997 attempt to merge was a “test” to see who were friends or foes in Washington. When they found the foes, they bought their friends in the next election.

    SBC/AT&T 1997
    http://www.bizjournals.com/sanfrancisco/stories/1997/05/26/daily1.html

    AT&T and BellSouth – 2001
    http://www.businessweek.com/bwdaily/dnflash/sep2001/nf20010927_3923.htm

  2. It will be interesting to see what happens when the FCC begins reviewing the reported and alleged merger of the AT&T/BellSouth deal. As it may be a much different Commission body with the hopes of Robert McDowell’s confirmation by the Senate.

    Mr. McDowell is a telecom lawyer who currently serves as assistant general counsel at Comptel and opponent of the AT&T and Verizon mergers last year. Mr. McDowell is scheduled to appear before a Senate committee on Thursday for his confirmation and is likely to be asked aboutthe merger.

    It will be also interesting to see how Chairman Martin handles Mr. McDowell. Although he is a Republican, his nomination to the FCC was not welcomed bythe Bell companies. Martin may have a tougher go at it this time without having any leverage over Commissioner Copps’ job to hang over his head and Commissioner Adelstein losing an ally. Perhaps Martin’s whipping days are numbered in making partisan rulings?

    As you may remember, Commissioner Copps’ reappointment was still in the air when the FCC pushed the SBC/AT&T – Verizon/MCI mergers through, with really no enforceable conditions. Both Copps and Adelstein where in a tough position when they gave in the on DSL changes in hopes of getting tougher conditions on the pending mergers.

    Well that backfired, and hopefully with jobs secured for a while and a potential ally in the making, they may be willing to push Martin’s back against the wall. It will also be interesting to see what newly appointed Commissioner Deborah Tate will swing on this.

  3. I wish I was a Telecom LAWYER cause you could have billable hours for decades to come…where does this leave Level3, Broadwing, Qwest, and Sprint??????? Is this truly the RBOC vs the CABLE Hatfield /McCoy ole west gunfight shootout?????????? Level3 has ALL six MAJOR CABLES as major customers…how and WHO switches those IP based calls from cable voip onto RBOC dominated ATT telco space?????

  4. Level3 shags WilTel and Progress Telecom…Qwest alone at the altar holding some nasty debt…Broadwing on Cramer Steroids…Sprint a lonely bridesmaid always a bridesmaid…any BETS out there who shags whom NEXT????????? HINT:::: Level3 JUST raised another 400 Million when they still have another Billion in cash and the ”Fat Lady”’ has NOT sung soprano as of yet!@

  5. I just want to nit-pick the WSJ article. If they’re going to try to wow people by drooling over the expansive SBC/ATT/Bell South territory, they should get their geography correct. Wisconsin and Michigan are old school Ameritech/SBC/ATT states and are further north than Illinois last time I checked.

  6. I wonder if Verizon is going to stay on the sidelines and watch the world go by…I am not happy to see this deal, neither one of these two companies have innovation on their plans.

  7. I can’t stress this one enough: divestiture has cost the American people billions since 1984. I believe the quote above by Frank Muto – WBIA was: “how and WHO switches those IP based calls from cable voip onto RBOC dominated ATT telco space?????” No kidding. AT&T’s “one policy, one system, universal service” brought Americans a low cost telecommunications network that was the most reliable in the world. The government replaced it with a handful of companies that barely know how to work together.

    “I am not happy to see this deal, neither one of these two companies have innovation on their plans.” Rick…Bell gave us the telephone, the transistor (solid state electronics), etc and would have kept innovating if it weren’t for government intervention barring it from entering other markets outside of telecom (1956). The government in the same time span gave us double digit inflation, double digit unemployment, the Vietnam war, the Korean War, both World Wars, and the Spanish American War. The government thought it had the right to tell AT&T how to operate its business? Let me tell you something about the Bell Monopoly: When Bell tried to lower its prices, it was called out as being noncompetitive because it was pricing itself out of the competition. I’d rather have a company that can offer lower cost combined with great service.

    Remember as well that BellSouth owns the Bell logo that AT&T had to give up in 1984. Maybe we’ll see a return back to the glory days after all…Bell Wireless instead of Cingular Wireless? I, too, am elated. This is a victory over government regulators who broke up the largest company in the history of mankind.

  8. May I offer a little gal’s thought with great respect to you, Om?

    Bellsouth and SBC have been partnering for years on projects. In my mind, the historical fission of Bell companies was merely “on the books.” Take for instance the consolidation of CABS (carrier access billing) and negotiation of billing cycle agreements with long distance carriers, resolving millions of dollars in account discrepancies. And ALECs/CLECs? BellSouth served as first-mover and mentor to SBC teams — sharing best practices and innovation. Whoever believes Ackerman and Whitacre don’t have accelerating innovation on their minds has seriously been quaffing ale with gusto. They practically consider themselves family members.

    Ackerman too has been calling for a change in policy for years –because telecom regulation constrained innovation in the marketplace, made it difficult for Bell companies to invest in new technologies (particularly in rural areas), and slowed the delivery of new services to all customers.

    kindly,
    kirsten

  9. Kirsten’s making some good points here, Om. I wouldn’t fall for that “little gal” stuff – Kirsten’s a smart cookie with some solid arguments.

    As for me, I remember the last man we named the “King of Telecom” – wasn’t it Bernie Ebbers?

  10. Jason:

    Don’t forget T1 transmission system. I dare say that without its near error-free performance, TCP would not have functioned well. Certainly, this would have limited Internet.

  11. barring it from entering other markets outside of telecom (1956). The government in the same time span gave us double digit inflation, double digit unemployment, the Vietnam war, the Korean War, both World Wars, and the Spanish American War. The government thought it had the right to tell AT&T how to operate its business? Let me tell you something about the Bell Monopoly: When Bell tried to lower its prices

  12. AT&T beat Verizon to the punch on this one. Vodafone has to begin to figure out they need to sell their stake in Verizon Wireless, and do an out of footprint/network play somehow in the USA.

    T-Mobile needs to get into the VoIP business, so maybe they buy up Vonage.

    Now AT&T’s CallVantage can maybe get relaunched, Packet8 gets run out of the South like the Carpetbaggers they are.

  13. Om, can you offer some perspective on where this will leave Vodafone? It’s getting out of the japanese market selling its stake to Softbank.
    The latest article from wsj states that verizon is trying to buy out the 45 % stake of vodafone. If vodafone does get out of verizon, is t-mobile going to be on its radar?

  14. There are two giant entities at work in our country, and they both have an amazing influence on our daily lives . . . one has given us radar, sonar, stereo, teletype, the transistor, hearing aids, artificial larynxes, talking movies, and the telephone. The other has given us the Civil War, the Spanish American War, the First World War, the Second World War, the Korean War, the Vietnam War, double-digit inflation, double digit unemployment, the Great Depression, the gasoline crisis, and the Watergate fiasco. Guess which one is now trying to tell the other one how to run its business?

  15. VOIP and wireless combo’s make a lot of sense from a customer’s point of view. This might make Vonage more valuable to some of the incumbents – Verizon and possibly T-Mobile. The question is – how deep do those pockets have to be.

    Is there an estimate of Vonage valuations?

  16. Well Om, you already know how I feel about this merger to be. I suggest we start calling Ed Whitacre the soon to be Chairman of Standard Telecom. So much for anti-trust law in this country, to say nothing of the regulatory agencies that will possibly rubber-stamp this deal A-OK. I guess the only good thing that will come out of this deal going forward is I will have a list of names of officals in government whom I can just cross of permanently as paid for by the RBOCs ad inifinitum.

  17. Update: AT&T, Verizon confirm the merger. “This merger is a logical next step that creates substantial value for customers and stockholders of both AT&T and Verizon,” said AT&T Chairman and CEO Edward E. Whitacre Jr in a statement. “It will benefit customers through new services and expanded service capabilities. It will strengthen AT&T through unified ownership and a single brand.” In other words, AT&T will soon be back as “Ma Bell.”

  18. Agreed, this is no surprise. It still doesn’t even come close to making AT&T as big as its main three competitors (Level3, Verizon, Sprint) in the Internet backbone game (this is the subject of this blog, right, the Internet?) The real question is what is next. I tried to address this over at my blog. Level (3) is the winner for the time being but they have to solve their Asia problem. I have a theory for how they might want to do that.

  19. I have Bell South Phone Service and Cingular combined Billing. May I add Att World Net to My combined Billing, instead of Paying currently via Credit Card. You can contact Me at 1-910-256-2508. Thank You!
    Len Nusbaum PS Am I entitled to any further discounts since I have Phone, Cell Phone and World Net with you all?

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