Consumers Will Benefit From AT&T-Bell South Merger

Washington, D.C., March 6, 2006—AT&T’s announcement that it will merge with Bell South is a pro-competitive move that will benefit consumers, says <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Wayne Crews, Vice President for Policy and Director of Technology Studies at the Competitive Enterprise Institute, a free market public policy group. <?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />

“The increasing ability of consumers to substitute different modes of communication—landline telephones, wireless, Voice over IP—for another is leading to an expanded marketplace that is transcending the public utility model of the telecommunications industry. The kind of network integration that we will see from the merger of AT&T with Bell South is necessary to encourage competition among the communications networks and to foster the rollout of new ones,” says Crews.

Last fall the Federal Communications Commission approved two telecom mergers, that of SBC Communications with AT&T and Verizon with MCI, with strings attached, including the regulation of wholesale rates and forcing the companies to offer unbundled DSL. CEI believes regulators should instead allow the marketplace to guide the future of communications technology.

“The conditions regulators tend to place on these mergers are unnecessary burdens to the potential gains they create for consumers,” says Crews.