Is the telecom merger bad for consumers?

Ashley Milne-Tyte Oct 24, 2006
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Is the telecom merger bad for consumers?

Ashley Milne-Tyte Oct 24, 2006
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TEXT OF STORY

LISA NAPOLI: The drama over the proposed AT&T/Bell South merger continues today. Earlier this month, two Democrats on the FCC forced postponement of a vote to approve the union. Today, the panel wraps up public comments ahead of a new vote scheduled for Nov. 3. As Ashley Milne-Tyte reports, consumer groups aren’t shy about their opposition to the deal.


ASHLEY MILNE-TYTE: If the merger goes through the new company will dominate phone and Internet service in California, Texas, the Midwest and much of the South.

Gene Kimmelman of Consumers Union says given the size and clout of the two companies . . .

GENE KIMMELMAN:” . . .we think the merger is very dangerous for consumers’ interest in more choices, lower prices.”

But Jimmy Schaeffler with The Carmel Group isn’t so sure. He says consumers have every right to worry about a genuinely uncompetitive monopoly, but in this case . . .

JIMMY SCHAEFFLER:“. . . there are so many new competitive services that are coming into the marketplace and it’s so hard even for the really big companies like AT&T to keep a handle on those new services.”

Schaeffler says the real test for the FCC could come down the road if the new AT&T and co-behemoth Verizon were to seek a merger.

That, he says, would be a bona fide threat to competition.

In New York I’m Ashley Milne-Tyte for Marketplace.

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