If you haven't already heard, the Federal Communications Commission has approved the $85 billion acquisition of BellSouth by AT&T.
The 4-0 vote of approval came Friday after AT&T sent in a modified proposal on Thursday that included a series of major concessions including a network neutrality agreement. In it, AT&T agreed to "maintain neutral network and neutral routing in its wireline broadband Internet access service." The agreement will last for 2 years or until any formal network neutrality agreement legislation is passed.
AT&T also included a commitment to rolling out IPTV in the BellSouth region: "AT&T/BellSouth will continue to deploy fiber-based facilities and intends to
have the capability to reach at least 1 .5 million homes' in the BellSouth in-region territory by the end of 2007. AT&T/BellSouth agrees to provide a written report to the Commission by December 31, 2007, describing progress made in obtaining necessary authorizations to roll-out, and the actual roll-out of, such advanced video services in the BellSouth in-region territory."
Network neutrality advocates celebrated in response. "We are no longer having a debate about whether net neutrality should be the law of the land," said Ben Scott, policy director for Free Press, a consumer advocacy group. "We are having a debate about how and when."
AT&T's proposal also includes providing a stand-alone DSL package for $19.95 for 30 months. AT&T is currently charging about $45 a month for the same service.
But there are skeptics as to how deep AT&T's concessions really go. Dave Burstein, of dslprime.com, points out in his last newsletter, "AT&T agreed 'not to provide...any service that privileges, degrades or prioritizes any packet transmitted over AT&T/BellSouth's wireline broadband Internet access service based on its source, ownership or destination.' A seemingly innocuous later sentence effectively makes that almost meaningless. 'This commitment also does not apply to AT&T/BellSouth's Internet Protocol television (IPTV) service.'"
It's understandable that many remain cautious. The new company will boast a market capitalization of more than $220 billion, twice that of Verizon, and serve 67 million local phone customers.
Whitacre will continue to serve as chairman and CEO and as a member of the board of directors. Duane Ackerman will serve as chairman emeritus of BellSouth for the transition period following the merger.
In the coming days, AT&T will launch extensive new advertising, which will begin the transition of the BellSouth brand name to AT&T. AT&T will re-brand Cingular through a co-branded transition, which is scheduled to start in 2007.
For previous coverage of the merger, see AT&T-Bellsouth Merger Takes Another Twist
, AT&T-Bellsouth Merger Hits Another Bump
, and AT&T-Bellsouth Merger Snags on FCC