AT&T, Bell South merger delayed

Dan Grech Dec 19, 2006


SCOTT JAGOW: A couple months ago, the AT&T – Bellsouth merger looked like a shoo-in.Ho-hum, just needed FCC approval. But that still hasn’t come. And yesterday, the FCC guy who was supposed to cast the tie-breaking vote said he’s not gonna do that because of conflict of interest. More now from Marketplace’s Dan Grech.

DAN GRECH: It’s the largest telecom merger in U.S. history and it has the FCC deadlocked.

AT&T and BellSouth had anticipated approval by year-end, but the Commission’s two Democrats want guarantees that all Internet traffic will be treated equally. They also want caps on pricing for corporate data lines.

Two Republican members favor the merger with minimum conditions. And the tie-breaker, Republican Robert McDowell, has abstained.

Media expert Ken Auletta is a staff writer at The New Yorker.

KEN AULETTA: You got two ideologies at war. One ideology is that mergers are bad, which tends to be the Democratic argument. The other ideology is that mergers are good, which tends to be the Republican argument. And the answer is often sometimes in the middle.

AT&T’s $85 billion buyout of Bellsouth is still expected to go through, but AT&T will have to make further concessions to the FCC Democrats.

In New York, I’m Dan Grech with Marketplace.

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