Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : WCOM -- Ignore unavailable to you. Want to Upgrade?

To: KevRupert who wrote (6244)	4/4/2000 11:48:00 PM
From: KevRupert	Read Replies (1) \| Respond to of 11568

Telecom Merger to Set a Standard by Berge Ayvazian Boston Globe March 7, 2000 Will the proposed MCI WorldCom/Sprint merger establish an AT&T vs. WorldCom long-distance "duopoly" that results in higher long-distance rates for consumers and businesses? Can it create an anticompetitive environment that will undermine the regional Bells? efforts to enter the long-distance market and the "development of competitive markets" envisioned in the Telecommunications Act of 1996? In reality, the impact on long-distance service isn?t necessarily the crux of this deal; it?s the new competitive blueprint it establishes for the communications industry that?s important. The proposed merger creates a $200 billion company ? even larger than AT&T (if only for a brief moment until the AT&T?s MediaOne acquisition is approved.) The regional bells are also in the game with several recent mergers and pending deals between Bell Atlantic/GTE and Qwest/US West that will help level the playing field. In 1984, the late Judge Harold Greene supervised the dismantling of AT&T to open markets and increase competition. Times have changed, and telecom companies are no longer exclusively in the "phone" business. To say the merger gives the combined company WorldCom too much control over long distance just isn?t relevant in today?s market, and the merger should be viewed in that light. Telecom companies must offer high-speed Internet service, Web hosting, corporate networking, wireless cell phone and paging services, video conferencing, local and long-distance voice services, and possibly even information content in their product portfolios to remain viable in the new economy. On Feb. 18, the FCC?s period for open public comment on the proposed merger ended and MCI WorldCom has 30 days to respond to public concerns and convince the FCC that the merger is a beneficial one. The $200 billion question, therefore, is whether the merger will benefit consumers and businesses. It can, but before the deal is approved MCI WorldCom and Sprint should take three affirmative steps to assure that the merger is pro-competitive: Prevent a long-distance "duopoly." Both companies should proactively promote increased competition in residential and business long-distance service. The regional bells are already rolling out competing long-distance service on a market-by-market basis, but at the current rate it will take several years before this service is approved in all markets. MCI WorldCom and Sprint should encourage the FCC to accelerate the process and authorize regional bell entry into long distance in all 50 states by the end of the year. Increase access to high-speed Internet service. MCI WorldCom should publicly demonstrate the technical and economic feasibility of providing two-way, wireless broadband Internet access to rural areas and other markets where fixed, copper wire-based cable modem and DSL broadband services are not available. Provide alternatives for corporate customers. MCI WorldCom and Sprint must ensure that large and multinational corporations have competitive alternatives to ensure attractive pricing, innovative offerings and responsive customer service for their multiservice data, voice, and video networks. This merger represents an opportunity to create a combined company, WorldCom, that is hand-tailored to address the evolving business needs of a 21st century communications provider. It should be encouraged, so long as proper competitive safeguards are in place. Berge Ayvazian is president and CEO of the Yankee Group, Boston.