Archives: Phones & Cell Phones

The recent wave of proposed mergers in the telecommunications industry -- SBC attempting to gobble up AT&T, and Verizon trying to swallow MCI -- mark the ultimate demise of the era in which consumers could expect more and more choices and lower prices for local, long distance, wireless, and new Internet-based services exploding on the market. 

Citing the acceptance of a lower bid and the unique competitive threat of the proposed Verizon-MCI merger, Consumers Union and Consumer Federation of America, two of the nation’s largest consumer groups, sent a letter to the Senate Judiciary Committee calling for immediate investigations into the merger wave in the telecommunications industry. 

Responding to requests, the Committee has begun hearings on the mergers.  Gene Kimmelman, Senior Director for Public Policy and Advocacy at Consumers Union, testified (PDF) in front of the Senate Judiciary Committee detailing how the proposed mergers will hurt consumers.  Dr. Mark Cooper, Director of Research at the Consumer Federation of America, testified (PDF) on the affects of a marketplace which would result in less competition for consumers.

CFA, CU and U.S. PIRG, the nation’s largest consumer organizations, joined NASUCA -- a 42-state association of state advocates designated by law to represent the interests of utility consumers -- in a joint press conference emphasizing that the mergers seek to transform Baby Bells into regionally dominant “Behemoth Bells”, undoing the anti-monopoly goals of  the 1984 breakup of the AT&T monopoly.

CU, CFA and US P.I.R.G also filed a petition to deny the merger between AT&T and SBC on the basis that the proposed mergers are not serving the public interest, hinder competition and overall will worsen the market for consumers.

These views are shared by other advocates, academics, market analysts and competitors.  The events of recent weeks have spurred a domino-effect of other mega-mergers in the telecom market. 

Read Phone Services: What’s At Stake and learn more about the issues that threaten competition in the phone services marketplace.  And get Consumer Tips to help you make the most informed decisions when shopping for local, long-distance or wireless phone services.