Fergie's Tech Blog

ISP's In Uproar Over Verizon-MCI Merger

Dan Neel writes in CRN.com:

The California ISP Association (CISPA) claims the merger of Verizon Communications and MCI will threaten ISP business models.

CISPA represents more than 180 ISPs. Mike Jackman, executive director of the Sacramento, Calif.-based organization, said the multibillion-dollar Verizon-MCI merger, announced in February, will run many pure-play ISPs out of business or force them to diversify their offerings--possibly into more value-added services that could compete with those provided by VARs and system integrators.

Verizon and MCI expect to close their merger by the end of the year. Another blockbuster telecommunications merger--between SBC Communications and AT&T--also is slated to close by the end of this year or in early 2006.

Spurring the CISPA complaint is an Aug. 5 Federal Communications Commission decision to reclassify DSL service as an information service instead of a telecom service, which Jackman said frees phone companies like Verizon from regulations requiring them to share bandwidth with ISPs. The FCC has placed a one-year grace period on enforcement of the change, he added.

posted by Fergie @ 8/23/2005 01:35:00 PM