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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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RE: Thank God for this merger
By rushfan2006 on 1/3/2007 2:28:51 PM , Rating: 1
What about the millions of Americans that can not afford health insurance? They sit for hours at free clinics just waiting for a chance to see a doctor and if the clinic happens to close down early, no luck. Everyone having health insurance, even if it takes 6 hours to get to a doctor, is better than only 50% having the "luxury" of going to a doctor.

First health insurance is expensive, quality health care is expensive that is one thing that everyone should be able to agree on. The quality of the socialist healthcare isn't on par to the quality of the non-socialist programs...that's my biggest argument. In the end who the hell cares if you see a doctor for your illusion of "free" (besides its not really free anyway)...if the treatment is sub-par to cure the condition, solve the medical problem. Add to this the huge wait times....I don't know , yet I hope, that in these programs people with real medical emergencies get pushed to the front of the line.

There are millions of Americans that can't not afford health insurance this is no doubt. But there are also many programs in the US that are there for dire emergency health care. Especially for kids. For example in the state of PA there is a program called CHIP (Children Health Insurance Program)....essentially its "free" health insurance for children in households that can't afford health insurance for children. Other states have similar programs in place or are in the works to follow suit.

But at the same time while you'd love to argue the point of people in the US that can't afford health care, I say before we give attention to that issue -- education, job training and more emphasis in staying in school so these millions of americans have the qualifications to A) Get a job that provides medical benefits or B) at least earn the wage to pay for medical plans on the side.

The point is...yes health insurance costs are insane, but to boldly say the people who need health care in the us can't get it is a lie. It's also one of the reasons why health care is so expensive in this country, the programs that provide it as "no cost" to you -- have to be paid for some way don't they?

All the critical needs "groups" have programs for health care -- children (yes), seniors (yes), people with disabilities (yes).....further more if you want to argue "well what about when I need to see a family doctor about a cold" there are programs even for that...costing as little as $40 a month. They aren't insurance but they reduce your medical bills by 40-70% at least.

My attitude is - I can't stand the lay down "whoa as me" excuse when the issue is about making somethign better for yourself (jobs/education) or healthcare.

RE: Thank God for this merger
By masher2 on 1/3/2007 3:24:47 PM , Rating: 1
> "My attitude is - I can't stand the lay down "whoa as me" excuse..."

Ahem...that's "woe is me". :p

RE: Thank God for this merger
By rushfan2006 on 1/3/2007 4:16:48 PM , Rating: 1
LMAO.....I don't know what drugs I was on when I did that one...

thanks for the correction. ;)

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