2006/03/06

Back To the Future of Telecom

In the beginning there was Ma Bell, and monopoly was on the face of Telecom. And the Justice Department said, "Let there be competition." And there was competition...but not apparently anymore.

After 22 years of grappling and merging, AT&T has announced plans to acquire BellSouth, and with that the 7 Baby Bells that were born in 1984 will be reduced to three mega-telecoms. Though no one is expecting the deal to be scuttled by regulators, at least not in this administration, we may want to step back and consider what this will mean for consumers.

After the merger there will be three giants but really only two that matter in terms of their reach and number of subscribers, Verizon and AT&T. Qwest is still around but at 1/5 the size of the new AT&T will probably be swallowed itself before long further reducing the competitive landscape.

William Smith, the soon-to-be-former CTO of BellSouth, and Edward Whitacre of AT&T/SBC are the two biggest proponents of the "pay-for-performance" Internet, and BellSouth has been implementing this for months. With the new lobbying strength of this telco behemoth, does anyone really believe that lawmakers will resist a move away from the "content neutral" Internet?

Who is the real competition for AT&T? Not Verizon and certainly not Qwest. It's the cable giants, Comcast and Time-Warner, and these companies should be alarmed because the mega-telcos have been pushing the government to support buildouts of "cable-like" services with little or no regulatory oversight.

So no matter how you slice it, this merger looks like just another attempt to fortify the big telcos against smaller more innovative players, and consumers will probably be the losers.

13 Comments:

The consumer has been having a losing season and seems it lasted for about five years.
and then...

Reasons that will be given for control of the Internet

Terrorism
Spam
Identity theft
Pornography
Convenience and Security


Reasons to think twice about it…

Anonymity outlawed and every penny accounted for
All transactions taxed
All of what you read, see, hear or communicate including where you are is known
hey..my comments gone..did you delete it Kvatch?
hey..my comments gone..did you delete it Kvatch?

Absolutely not. I don't ever touch comments, but I have noticed that sometimes when two comments are submitted within about 30 seconds of each other, one will get dropped. It's a database update problem with Blogger, I think.

What time did you submit it?
AT&T to US: All of your base are belong to us.

Sigh. Didn't the government take care of this in the early 80's?

Isn't a free market economy all about competition that is supposed to benefit the consumer?
The Progress and Freedom Foundation is inexorably at work. If we continue to have the same Congress and the same kind of White House and a Supreme Court in bed with the corporatists, Kvatch, you and I, along with all our other brothers and sisters in the blogosphere will be shit out of luck. Of course, I am not telling you anything you don't already know.
Kvatch, you and I, along with all our other brothers and sisters in the blogosphere will be shit out of luck.

Well...not if we partner with Google, Yahoo or whomever. What do you thing, Stephen? "Orwell's Groogle"? And I could have "Blognonyhoo". Or perhaps "Grognonymous"?
Yeah, big surprise, deregulation ended up doing only that, removing the few controls that were present on the telecoms. All that crap about more competitive makets, more efficient business, that's all garbage.

What it did was remove the limits on profit that was set by regulation. And now that we're getting back down to two or three, they will reap the benefits of that.

If there are only two or three participants, it is very easy to over the board collude on pricing. You don't even have to hold the secret meetings.

Mike
No secret meetings?
One corporation under God takes liberties, with justice for none
It's like a friggin' cancer. Looks the remission only lasted 20 years.
I think I put up the first comment..oh well..it was a long-winded sucker too.
Sorry 'bout that Dusty.

Neil, you're right, and I think I know what's going to happen. Rather than giving me more options from which to pick and choose, they'll just shove a bigger, more expensive package of crap in my direction.

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