Comments on: SBC, AT&T say Bell breakup doesn't work

Twenty years after Ma Bell fell, consumers need nationwide providers again, merging companies tell government regulators.

Smoke and Mirrors

The claim that the lines between long distance and local calls are being erased because of broadband telephony is nonsense. The number of calls terminated on broadband phones is negligeable. Calls made from broadband VOIP phones are terminated mostly on local phone lines where guess who has a defacto monopoly, and makes money on every minute of every call. The reality is that SBC is able to buy AT&T, its former parent, because SBCs assets, the local loop, remained a monoply while while AT&T had to compete in a competitive market. Does anyone really believe SBC is able to buy AT&T because SBC is a nimble superior competitor in a competitive market, rather than because of its near-monopoly power?

Shameful National Security Argument

After decades of lobbying governments around the world to open their telecoms markets to foreign investment, and actively investing abroad does SBC-AT&T feel no shame to pull out the "if we don't buy it a foreigner will and this will be bad for national security" argument? Does this mean that SBC, which prides itself on its good corporate citizenship, has actually been conning foreign countries into forfeiting their national security when arguing for opening up the telecoms market to foreign investment?

Flimsy arguments, bu what about alternatives?

The Bush Administrations have single-handedly given back to corporate giants the monopoly power of a national telco. The UN, supported heavily by the US delegation, championed and passed a resolution back in 1995 that member nations should privatize their national telephone monoplies in an effort to build international investment, improve infrastructure, and thus promote the world economy. The Incumbent telcos in the US put up with competition only as long as it served their purposes of getting into long distance and then closed the door to competitors through their monopoly power and use of the court system to bypass traditional telco regulators. This new national monoploy of megalith mergers rolls back the clock 30 years and flies in the face of every other nation in the world that is trying to find a model for competition and self development.

Is the Justice Department so naive as to think national security would be compromised without a national monopoly? What about US companies creating huge competitors in the newly opened other nations of the world? What happens when those countries decide that it is their national security interests to takeover any US company investment assets and go back to a national monopoly?

On the flip side, as a hope for consumers, there are the cable monopolies who, with public financing, have built urban networks that can be used for even better communications that most old telco networks. Thus far, there has not been any regulation to open these networks to competitors and lower the price of cable, much less offer alternative communication providers to consumers. Those networks were built with public financing and federal subsidies just as the telco networks were and should be subject to public use through competition.

Additionally, there are trials of telco and video over power lines that might serve as other alternate competitors in the US. Again, those networks were built with federal subsidies and public financing as well, so a very logical regulatory policy would be to make those outlets available to competitors.

Satellite is currently an alternative, but not as handy or reliable as a wired service.

The lessons learned from the megadollar fighting of competiton by the incumbants in the telco industry should be used as forewarnings of what will be to come in the other two industries when, and if, the federal government stops sucking on the milk of their corporate campaign contributions and adopts a reasonable capitalistic approach to communications policy in this country as the UN has tried to do elsewhere in the word.