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FCC Approves AT&T, MCI Mergers

November 1, 2005
The Federal Communications Commission has approved two mergers involving four of the nation’s largest telecommunications firms. By a 4-0 vote, commissioners cleared the way for SBC Communications to take over AT&T and Verizon to acquire MCI.

AT&T • Slamming • Long Distance • Local • Wireless • Broadband • Telemarketers --- News • AT&T Agrees to Refund Some Ringtone Charges • States Asked to Probe AT&T U-Verse Explosions • AT&T Exits Pay Phone Business • AT&T Changes Contract Policy • AT&T Changes Terms Of Service After Outcry • AT&T Agrees to New Stolen Cell Phone Rules • AT&T Stiffens Language Covering Objectionable Content • AT&T Adds Parental Controls To Mobile Phones • AT&T Slammed Over Rebate Policies • Appeals Court Shreds AT&T Arbitration Clause • Court OKs Rebate Lawsuit against Cingular/AT&T • AT&T Trashes Cingular Brand • AT&T Offers Net Neutrality Concessions To Win Merger Approval • FCC Delays Decision On AT&T/BellSouth Deal • Justice Department Green Lights AT&T-BellSouth Merger • FCC Clears the Way for AT&T-BellSouth Merger • AT&T Trumpets New TV Service • AT&T Web Site Hacked; Customer Data Exposed • AT&T Sues Calling Record Brokers • AT&T Declares Consumers' Personal Data "Corporate Property" • AT&T Plans to Kill Cingular Name • Report: AT&T Acquiring BellSouth • SBC Recast as AT&T • FCC approves AT&T, MCI Deals • Justice Dept. OKs AT&T, MCI Sell-Outs • SBC Will Keep AT&T Name • Consumer Groups Oppose Big Telco Mergers • SBC Buys AT&T • AT&T Will Pay Refunds to New Yorkers • AT&T Will Pull Out of 7 States • AT&T Teams With Sprint to Return to Wireless Business • Minnesota Sues AT&T • Class Action Charges AT&T With Slamming • Another AT&T Rate Hike • AT&T Hiking Minimum Fees • AT&T Faces $780,000 Do-Not-Call Fine • AT&T Will Run Do-Not-Call List • Supreme Court Denies AT&T's Appeal of Arbitration Ruling

Among the conditions placed on the deals, the combined companies will be required to offer their high-speed Internet access as a stand-alone service, so customers aren’t required to buy local phone service in order to get Internet service.

Consumer advocates said the conditions don’t go far enough. The Consumer Federation of America has called the deals “harmful to consumers.”

SBC, which is renaming itself with the better-known AT&T brand, hailed the FCC action, saying it marks a "major milestone." With the action, the FCC joins 33 states and the District of Columbia in clearing the merger. Reviews are still pending in Arizona, California and Ohio.

The Verizon-MCI deal also faces review in a handful of states, but the company said the FCC approval adds momentum for clearing the deal. Executives for both MCI and Verizon said they believe they can close by the middle of February.

"After two federal reviews and strong approvals by shareholders and the international community, it is clear that this combination is undeniably in the public interest," said Tom Tauke, Verizon executive vice president of public affairs, policy and communications.

"The Department of Justice and FCC approvals put us on firm footing as we seek the remaining few state approvals."

To win approval the companies pledged not to hinder Internet access to consumers or the free flow of Internet traffic on their networks. They also promised to allow customers access to rivals' Web sites and competing offerings like Internet phone service.

The federal regulators required that SBC and Verizon freeze the wholesale prices they charge competitors to lease certain high-capacity business lines for at least 30 months.

With the acquisition of AT&T, SBC Communications is now valued at $16 billion; Verizon and MCI are worth about half that.

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