The Return Of Ma Bell?

Talks between AT&T and SBC raise fears of a new monopoly

If there's one thing that Robert E. Allen has learned in the 13 years since the modern AT&T was created from the breakup of the old Bell System, it is the awesome power of competition. Allen, chairman of AT&T for the past nine years, has seen competitors--from MCI Communications and Sprint to tiny dial-around companies--steal market share. He has watched price wars corrode his profits and depress his stock. Allen's conclusion: The way to get AT&T back on track was to play the aggressor in a market still untouched by competition--local calling. The Telecommunications Act of 1996 opened the regulatory door, and some promising wireless technology acquired with McCaw Cellular Communications Inc. in 1994 gave Allen the means.

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