Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Businessweek Archives

What Telecom Reform?


Editorials

WHAT TELECOM REFORM?

The merger negotiations between AT&T and SBC Communications reflect the dawning truth that the Telecommunications Act of 1996 is turning out to be a colossal failure. It has not opened up local phone service to competition. Indeed, it appears to be actually bolstering the monopoly power of the regional Bells. AT&T's decision to buy into the huge local phone company that includes the former Southwestern Bell Telephone Co. and Pacific Telesis Group is an admission of defeat. AT&T doesn't think it can successfully compete locally so it is simply buying into the monopoly.

This isn't good for the economy and it isn't good for the consumer. The Telecom Act was supposed to usher in a new era of competition, generating new products and services, lowering prices. But it now appears that Congress wrote legislation that was too partial to the Baby Bells. Some state regulators then protected their hometown companies. And the Bells have used the courts to keep outsiders out. There is nothing "natural" about local phone monopolies. They are creatures of lobbyists, politicians, judges, and regulators--and legislators.

The Telecom Act of 1996 has to be rewritten.


LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus