Fergie's Tech Blog

Qwest repeats call for conditions in telecom mergers

Grant Gross writes in InfoWorld:

Qwest Communications International Inc. on Wednesday stepped up its push for the U.S. government to impose conditions on two mergers involving four of its telecommunications competitors.

During a Washington, D.C., press conference, Qwest repeated earlier requests for government conditions in Verizon Communication Inc.'s acquisition of MCI Inc. and SBC Communications Inc.'s acquisition of AT&T Corp. The two resulting telecom giants would create two "mega-sized monopolies," said Steve Davis, Qwest's senior vice president for public policy and deputy general counsel.

The two merged companies would dwarf other telecom companies in the U.S., with Verizon and SBC owning more than 70 percent of the residential long-distance market in many of the territories they operate, said Qwest, which lost out to Verizon in its bid for MCI. SBC's region includes the southwestern U.S. and parts of the Midwest; Verizon's territory covers the northeastern U.S.

The mergers of the two largest local telephone providers in the U.S. with the nation's two largest long distance carriers will cause the largest "fundamental reshaping of the telecom marketplace" since the U.S. government broke up the old AT&T in the mid-1980s, Davis said. Unless the U.S. government imposes some conditions, the mergers will cause price increases for a wide variety of telecom customers, he said.

posted by Fergie @ 10/12/2005 03:51:00 PM