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The biggest telecommunications merger in U.S. history just received federal approval

The Federal Communications Commission on Friday approved AT&T Inc.’s $86 billion acquisition of BellSouth Corporation, making it the largest telecoms merger in U.S. history.

The completion of the BellSouth acquisition comes after an extensive review process which included approval by or filings with 36 states, the U.S. Department of Justice and the FCC, as well as with three foreign countries. In order to receive bipartisan FCC approval, AT&T volunteered to make broadband access increasingly affordable and available to consumers and to support public safety.

Through a combination of technologies, AT&T is committed to making broadband services available to 100 percent of residential living units in it's 22-state local-phone-service territory by the end of 2007. Additionally, AT&T will offer a stand-alone broadband service for $19.95 as well as other offers to encourage broadband adoption by those who do not currently subscribe.

The transaction also consolidates ownership and management of Cingular Wireless and AT&T will immediately integrate and converge AT&T, BellSouth and Cingular wireless and wire line Internet Protocol networks, combine product portfolios and integrate customer care capabilities. The new company also plans to expand the reach of broadband access in remote and rural locations in the traditional BellSouth region.

"AT&T, BellSouth and Cingular have led in developing and deploying many of the communications services that customers depend on today, including broadband DSL and wireless technologies," said AT&T Chairman and CEO Edward E. Whitacre Jr. "Moving forward, AT&T will work to integrate these services for customers in the Southeast, across the country and around the world."

AT&T will launch new advertising which will begin the transition of the BellSouth brand name to AT&T in the coming days. AT&T will re-brand Cingular through a co-branded transition which is scheduled to start in 2007. Details regarding the Cingular branding will be announced at a later date. will not undergo a name or Web site address change.

AT&T's corporate headquarters will remain in San Antonio. The new AT&T Southeast (formerly BellSouth Corporation) and Cingular will continue to be based in Atlanta.

Stockholders of the former BellSouth received 1.325 shares of AT&T common stock for each common share of BellSouth. Based on AT&T's closing stock price on Thursday, Dec. 28, 2006 this exchange ratio equaled $47.04 per BellSouth common share. Since the merger was announced, the market price of AT&T shares has risen 26.83 percent and BellSouth shares have increased 48.76 percent. BellSouth's common stock and debt securities will be immediately delisted from the New York Stock Exchange in connection with the completion of the acquisition

AT&T plans to repatriate 3,000 jobs currently outsourced by BellSouth outside the United States as well as to make its disaster-recovery capabilities available to facilitate the restoration of services in the former BellSouth region in the event of a hurricane or other natural disaster.

"These commitments reflect our long history of providing consumers and businesses with the most advanced and affordable communications services," said Whitacre. "We can't wait to show people what the new AT&T can do."

The Communications Workers of America believe the merger of AT&T and BellSouth will promote increased investment and build-out of high-speed networks that are critical to the region's economic growth and the nation's position in the global economy. CWA President Larry Cohen said the merger agreement included real commitments by AT&T-BellSouth for an expanded build-out of both higher speed Internet services and DSL, an important step forward in bringing the full promise of the Internet to areas that have been passed by.

"Workers at BellSouth know that the future of communications and their own future is in the build-out of high-speed telecommunications services. This merger will help provide the resources to make this possible, and at the same time, should help create quality jobs," said Noah Savant, CWA's vice president for the Southeast and BellSouth territory. "Of course we remain concerned about the net effect on jobs within the region for frontline employees and the services we provide. We are pleased to see AT&T commitment to bringing thousands of support jobs back to the United States," Savant added.

The U.S. has fallen to 16th in the world in terms of availability and access to high-speed Internet services. The availability and benefits of the Internet should be universal, but residents in rural communities, low-income urban areas and other communities don't have high-speed access and are at a growing disadvantage.

High-tech innovation and job growth, advances in telemedicine, distance learning, improving public safety and e-government all are possible and in fact routine in much of the world. In the United States, however, current speed standards are not sufficient to support these kinds of services, Larry Cohen said. "The build-out of true high-speed networks requires a huge investment of tens of billions of dollars and the AT&T-BellSouth merger will begin to provide the resources to do this," he added. Cohen also stressed that CWA strongly supports an open Internet "where consumers can go where they want, when they want. Nothing should be done to degrade or block access to websites," he said.

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The circle is complete
By AlexWade on 1/2/2007 12:46:36 PM , Rating: 2
AT&T is split into several companies. SBC and BellSouth are two of those.

AT&T Wireless is split off from AT&T.

BellSouth and SBC join together to make Cingular.

AT&T Wireless is bought bought by Cingular.

SBC buys AT&T. Changes their name to AT&T.

SBC merges with BellSouth.

How much you want to bet that Cingular will now become AT&T Wireless?

RE: The circle is complete
By masher2 on 1/2/07, Rating: 0
RE: The circle is complete
By retrospooty on 1/2/2007 1:35:13 PM , Rating: 3
"Not going to happen. Cingular has excellent brand name recognition...the name isn't going away soon"

Its already happening. I work for a cell manufacturer and we are preparing newly branded plastics now. I beleive it will be announced in Q2

RE: The circle is complete
By masher2 on 1/2/2007 1:43:30 PM , Rating: 2
You're right...I just looked into it. I'm behind the times apparently.

RE: The circle is complete
By retrospooty on 1/2/2007 2:35:06 PM , Rating: 3
Ya, it's weird, because when ATT wireless and Cingular merged, they specifically dropped ATT and used Cingular due to the negative perception that customers had of ATT... now they say they are switching to ATT due tot he enormously recognized brand name LOL... Total about face.

"Call the phone company? But which one? There are so many of them and they keep changing thier names !!! aaaaaaaaaaaughhahaha" (sobs incoherently) - Homer simpson.

RE: The circle is complete
By stlrenegade on 1/2/2007 1:44:19 PM , Rating: 2
My wife works at AT&T (formerly SBC) in the DSL unit. She's privy to company-wide information and she told me at the beginning of the merger talks was that one of the first things Whitacre wanted to do was change Cingular name to AT&T.

RE: The circle is complete
By othercents on 1/2/2007 12:50:19 PM , Rating: 2
AT&T will re-brand Cingular through a co-branded transition which is scheduled to start in 2007

Actually they do own Cingular wireless with this merger.


RE: The circle is complete
By Lazarus Dark on 1/2/2007 1:04:33 PM , Rating: 3
yeah, its kinda funny, years ago, I had at&t wireless, then cingular took over and my bill and phone said cingular. now att buys cingular and the bill and phone will say att wireless again. musical chairs at one billion dollars a chair.

"Young lady, in this house we obey the laws of thermodynamics!" -- Homer Simpson

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