SBC and AT&T Merger Essay

1. What hurdles would SBC need to overcome (including state and federal objections) upon their entry into the long-distance market?

            One of the legal impediments SBC has to face in entering the national market for telecommunications through its 16 billion dollar merger with AT&T is the Anti-Trust law. In maintaining the US policy of protecting economic fairness and consumers continues to guarantee that mergers would not cause a monopolization of the market. A federal court judge demanded last July 26, 2006 for example, to review the agreements made by the justice department and the telecommunication companies to determine whether or not pblic interest is maintained despite the merger; this is lieu with the Tunney Act covered by the Anti-Trust Law. (Broache, 2006)

            Aside from the actual legal hurdles, SBC has to address the plights and concerns of consumer unions and competitors, unless they wish to be submerged in a pile of complaints and possible lawsuits. In infiltrating the global market, the said company has to makes sure that it does neglect certain legalities and obligations to the state and its consumers.

2. Other than pricing, what are some pitfalls consumers have to deal with when two companies such as AT&T and SBC merge?

            From a personal perspective, I think that this merger could reel in more benefits for the consumers than pitfalls. However, since the latter is being asked for, I’d have to say that the biggest downside would be in the range of product and service choices. A mega merger like that of SBC-AT&T would dominate the shares in the industry.

            There is also the disadvantage on the part of AT&T clients in the light of the changes that would occur on their billings and charges. Changes in the procedure and processing of paper works would take place due to the need of SBC and AT&T to reconcile their accounts. As such, during the initial phase of the merger, there would take place technical difficulties in line with the updating of systems.

            Otherwise, such inconvenience may be overcome by the fact that people would have a one stop shop for all their telecommunication needs.

REFERENCE:

Broache, Amy, “Judge balks at closure of AT&T, Verizon mergers”, retrieved from news.com: <http://news.com.com/Judge+balks+at+closure+of+AT38T,+Verizon+mergers/2100-1036_3-6098128.html>, Accessed on: August 16, 2007