Last updated: February 21, 2008 - 3:58am
FCC IS LIKELY TO PUT CONDITIONS ON AT&T DEAL
[SOURCE: Wall Street Journal, AUTHOR: Amy Schatz Amy.Schatz@wsj.com]
Federal Communications Commission staff recommended approving AT&T Inc.'s $67 billion purchase of BellSouth Corp. with no conditions. Although the FCC staff and Chairman Kevin Martin are advocating no conditions, it is highly unlikely the deal will clear the commission without restrictions. The FCC's newest commissioner, Robert McDowell, is not expected to vote on the matter because of his previous career as a lobbyist and telecom attorney for smaller phone companies, FCC officials said. Those companies are opposing the deal. If Commissioner McDowell is recused from voting, Chairman Martin will have to reach a compromise with the commission's two Democrats, who are expected to press for conditions similar to those imposed last year when the Commission approved the purchase of AT&T by SBC Communications and Verizon's purchase of MCI. Those conditions involved treatment of Internet traffic. In a possible bid to avoid imposing similar conditions this time that would affect only AT&T, the FCC is also set to open a formal inquiry into whether industrywide rules need to be written that would require Internet providers -- including phone companies -- to treat all Internet traffic equally, otherwise known as net neutrality. High-tech companies and consumer advocates have complained phone and cable companies may try to discriminate against some Internet traffic and want rules to prevent that. The FCC's two Democrats successfully got conditions to prohibit AT&T and Verizon from doing that in the deals last year and are expected to try again. The FCC is set to vote on the deal at its Oct. 12 meeting.
* FCC Chair Said to OK AT&T-BellSouth Deal
* Competition Coalition Statement on Reports of FCC Draft AT&T, Bellsouth Merger Approval
"We are disappointed that the FCC Chairman has signaled his intent to approve the AT&T/BellSouth merger without a single condition to protect competition and consumers. By all accounts, the only voice calling for a rubber stamp approval of this merger is AT&T itself. As parties who have filed with the Commission concrete evidence of the irreversible marketplace harms that this merger will produce, we urge restraint and reiterate our call for concrete conditions that protect Americans from harm. It would be precipitous and unprecedented for the Commission to take action on this merger while the Department of Justice is under federal judicial scrutiny for its approval of the SBC/AT&T and Verizon/MCI mergers."
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