AT&T, MCI takeover approved

Washington, November 1:

Federal regulators approved SBC Communications’ takeover of AT&T and Verizon ommunications’ purchase of MCI Monday in a move consumer activists called anticompetitive.

By 4-0 votes, the Federal Communications Commission approved a compromise adding conditions - but also removing the last regulatory barriers - to the multibillion-dollar mergers.

The agency required that SBC and Verizon freeze the wholesale prices they charge competitors to please high-capacity business lines and said they had to guarantee that they will sell their Internet access as a stand-alone service, so customers aren’t forced to buy local phone service as well.

Most state regulatory agencies already have sanctioned the unions, although several more still are needed. The acquisition by SBC Communications Inc. of AT&T Corp. is valued at $16 billion; the deal with Vermzon Communications Inc. and MCI Inc. is said to be worth about $8.5 billion (euro7.07 billion).

FCC Chairman Kevin Martin had wanted the mergers approved without conditions. The two Democrats on the four-member panel balked at that, believing it would hurt competition. Martin postponed a vote for Friday and continued negotiations during the week end to work out a deal. “I believe that affected markets would remain competitive,” he said. “The parties involved have chosen to make commitments now in order to obtain the certainty of immediate commission approval.” Critics of the deals had complained that asset sales in overlapping areas were needed to ensure healthy competition.