Mega-Merger vs. Internet Freedom
October 13th, 2006 by tkarrEarlier this week, the Justice Department went AWOL on protecting a free and open Internet for tens of millions of Americans. Now it’s left to three men and one woman at the Federal Communications Commission to approve or scuttle the proposed AT&T-BellSouth merger.
At issue is whether the AT&T colossus should be allowed to gobble up the nation’s third-largest phone company as it re-assembles the Ma Bell monopoly of yesteryear. But the stakes are much higher today than when – prior to its 1984 antitrust break up – just one phone company ruled the nation’s copper wires and rotary phones.
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In 2006, AT&T is poised to control all electronic media – not just telephones, but TV, music and the Web – that will enter homes via its same Internet “tube.” The corporation – led by monopolist-in-chief Ed Whitacre – sees Net Neutrality as a major obstacle to this multibillion-dollar scheme. Without Net Neutrality, he’s free to toss the open, egalitarian Internet out the window.
A Bigger AT&T Is Bad for the Net
On Wednesday, the Justice Department stunned public interest advocates by green-lighting Whitacre’s merger without any conditions or judicial review. The FCC could give final approval as early as November 3.
FCC Chair Kevin Martin has already indicated his willingness to follow the DoJ’s lead and rubber stamp the $78 billion deal without protecting Internet freedom.
In Martin’s view, the proposed merger does not raise a significant threat to Internet choice or Net Neutrality. Regrettably, this view ignores the enormous market power that a new AT&T would wield. The merged entity would become the principal – in most cases only – DSL provider in 23 states.
Martin has also ignored prior statements by executives of both companies. In interviews with the Financial Times, Washington Post and Business Week, Whitacre and BellSouth executives have outlined plans to consolidate their control over the Internet by erecting new online toll booths and discriminating against Web sites that don’t pay their “special service” fees.
“There’s no bigger interest to the public than maintaining a free and open Internet,” writes Art Brodsky of Public Knowledge. “But, like the Justice Department, the FCC is preparing to take a dive on the issue of Net Neutrality.”
Deadlocked at the FCC?
But there is a flicker of hope. After Wednesday, when the DoJ gave its nod to the merger, more than 20,000 Free Press and SavetheInternet.com activists have sent letters asking for a Net Neutrality to be a condition of the FCC’s approval. Two of the four commissioners who will vote, Democrats Michael Copps and Jonathan Adelstein, have indicated that they will support this as part of any merger. But they still need strong public support to prevail.
The fourth, Republican Deborah Tate of Tennessee, is expected to follow Martin’s lead – deadlocking the FCC at 2-2.
According to Harold Feld of Media Access Project, the only way to break the tie would be for Martin to force a fifth commissioner, Robert McDowell, to “un-recuse” himself from the process. McDowell had backed away from involvement due to a conflict of interest from his prior work for phone companies trying to compete with AT&T.
“The FCC General Counsel has the authority to declare McDowell’s recusal invalid if the public interest in resolving the merger application outweighs any appearance of impropriety,” Feld says. “Such a move would be extraordinary, however. To the best of my knowledge, it has never happened.”
It’s up to the FCC to step in where the Justice Department fears to tread; to put away rubber stamps and 11th-hour maneuvers and serve the interests of a free and open Internet and the millions of Americans who use it.
October 13th, 2006 at 8:29 pm
[…] The Postponement of the FCC decision on the AT&T BellSouth Merger creates a time for all of us when we must work harder than ever to man the phones, fire off those emails and write those letters to the editor. Though I believe the merger will eventually happen the key now is to make sure the FCC puts conditions on the deal that will buy us the time to ensure the future of the web. I do think that Copps and Adelstein want to do what’s best to protect the US taxpayer, but huge political weight is being brought to bear against them. I hope they can see their way to do what’s best, or, if blocking the merger entirely isn’t in the cards, then they at least wring out a few years of Net Neutrality as a condition, as well as a few other bones, and buy us all the time we need to change the color of the electorate. […]
October 16th, 2006 at 9:21 am
If the FCC votes in favor of the people, which I’m praying they do, then it will restore my faith in the system of our country. When I first got involved with trying to save Net Neutrality, the situation seemed more and more bleak every day. If we win this, it will be a major victory for the Net Neutrality cause and will send shock waves through the country and the free Internet as we know it. Hopefully, this victory will show others the importance of a free Internet. Allowing this merger to happen would be the undoing of what was done some 20 years ago. How can we blindly let history repeat itself?