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To: Anthony Wong who wrote (3395)	10/15/1998 6:32:00 PM
From: Anthony Wong	Read Replies (2) \| Respond to of 11568

Long-distance Cos., Consumer Groups Oppose SBC Buying Ameritech Bloomberg News October 15, 1998, 4:55 p.m. ET Long-distance Cos., Consumer Groups Oppose SBC Buying Ameritech Washington, Oct. 15 (Bloomberg) -- The nation's three largest long-distance phone companies, consumer groups, and others have mounted a campaign against SBC Corp.'s $69.5 billion purchase of Ameritech Corp., saying it will thwart local phone competition. AT&T Corp., MCI WorldCom Inc. Sprint Corp., and consumer groups told the U.S. Federal Communications Commission today that the SBC-Ameritech transaction should be blocked outright because it would reduce the likelihood of true competition in the local phone market. Instead, it would allow SBC and Ameritech to further solidify their monopoly positions. ''There are no conditions that are going to fix this problem, because the loss of a potential competitor is forever,'' said Richard Devlin, Sprint Corp. executive vice president of law and external affairs. Sprint, AT&T and MCI WorldCom are all trying to compete against the Baby Bells in the local phone business. The FCC review of the transaction will consider whether it's in the broad public interest, while the U.S. Department of Justice will determine whether it violates antitrust laws. The first batch of comments on the combination were due at the FCC today. Ameritech launched a preemptive strike yesterday against critics of the SBC-Ameritech combination, briefing reporters on the merits of the transaction. Only a combined SBC-Ameritech will have the size and scope necessary to compete with global telecommunications companies like AT&T, MCI-WorldCOm and others, said Kelly Welsh, Ameritech's general counsel. SBC and Ameritech are also touting the transaction as an answer to local competition. They've told regulators that by combining their resources, the new company will have the necessary financial backing to compete in the local phone business in 30 markets outside of their region. Opposing Arguments Sprint said in its FCC filing that the ''premise of the strategy defies commercial realities, common sense and does not, in any event, have any substantiated tie with the merger.'' MCI Worldcom agreed. ''If SBC and Ameritech would not find it in their overall economic interests to compete out of region without the merger, they will not compete out of region even if they merge,'' the company said in its FCC filing. '' The merger is essentially irrelevant to the likelihood that SBC and Ameritech will compete outside their current regions.'' Consumers Union and the Consumer Federation of America said the past anti-competitive behavior of SBC and Ameritech are an indication of how the two combined would behave. ''They have thrown every barrier imaginable to competition, in particular with SBC earning a national reputation as the Baby Bell most hostile to competitors,'' said Janee Briesemeister, a Consumers Union senior policy analyst. The Communications Workers of America, which represents 78,000 employees at SBC and 30,000 at Ameritech, came out in favor of the combination. The union cited SBC and Ameritech's commitment to compete in the residential phone business outside of their region, which the union says will create at least 8,000 jobs. --Heather Fleming and Alan Wolf in Washington, (202) 624-1835/ah