*When the Bell telephone system – aka AT&T – was broken up in 1984, consumers were told this would be a good thing because it would increase competition.
When the U.S. telecommunications market was deregulated in 1996, consumers were told this would be a good thing because it would increase competition.
And now AT&T wireless is planning to merge with T-Mobile, the latest in a string of acquisitions that effectively restores Ma Bell to her former girth yet allows the company to operate in a looser regulatory environment.
Consumers might wonder if they’ve been played.
“There’s no way this latest merger can be good for consumers,” said Sally Greenberg, executive director of the National Consumers League. “This places a lot of power in the hands of only a few companies.”
That’s not how AT&T’s chief executive, Randall Stephenson, sees it. He said the $39-billion deal with T-Mobile will create “significant customer, shareowner and public benefits” that will “better meet our customers’ current demands.”
The reality, however, is that the most competitive segment of the telecom market – wireless service – will now have one fewer player, and we are a big step closer to a marketplace controlled by only two companies, AT&T and Verizon.
Read the rest of this story at the LA Times.