SBC-Ameritech Merger Will 'Jumpstart Competition'
Chairmen Cite Growth, Consumer Benefits of Merger Before FCC
San Antonio, Texas, October 22, 1998
For further information, contact:
George Stenitzer, 312-609-6166, firstname.lastname@example.org
WASHINGTON -- In comments before the Federal Communications Commission today, the chairmen of SBC Communications and Ameritech outlined the global competition driving the merger between the two companies and the benefits that millions of residential and business consumers would enjoy once the combined company begins serving markets across the country.
"I am convinced that the national-local strategy, enabled by this merger, will jumpstart competition just as the Telecommunications Act of 1996 contemplated," said SBC Chairman and CEO Edward E. Whitacre Jr.
"National-local" is the strategy of providing facilities-based competition in the nation's top 50 markets for business and residential customers, which neither company could successfully implement without the merger. The plan anticipates the deployment of 2,900 miles of fiber and 140 switches to serve customers in those markets.
Ameritech Chairman and CEO Richard C. Notebaert focused on customers' demands for telecommunications companies to expand in order to serve all their needs.
"Corporations with worldwide business interests seek the efficiency of a single provider for all their telecom services," Notebaert said. "It is clear that the business of these largest and most sophisticated business customers will move to those companies that come closest to providing the goal of one- stop shopping for end-to-end integrated service. And it is clear that to be competitive in that critical high-end market, communications providers must have significant global reach, a large base of existing business customers and a wealth of technical, financial and managerial resources."
"Our merger has always been driven by growth -- growing sufficiently in scope and scale to meet customer needs and to compete for a place among the global full-service providers," said Notebaert.
"This merger is about transforming our companies from regional carriers to a national competitor," said Whitacre, who said that customers inside and outside the two companies' 13-state region would benefit from the "national- local" strategy. "Obviously, the 59 million business and residential customers in the markets outside our region will have an alternative provider that would not exist but for the merger, " he said.
"We believe that Bell Atlantic-GTE, BellSouth and others who face the brunt of our attack will respond aggressively [in our region]," he said. "MCI/WorldCom, AT/TCI and Sprint will increase their own competitive initiatives in and out of our region."
Notebaert noted that the march toward global communications is on, and cautioned that decisions made by the FCC will "determine the extent to which American companies will have opportunities to be players in that marketplace."
"It should be up to customers to decide which companies succeed," he said. "The FCC should not pick winners and losers."
Since the two companies announced plans to merge in May, the merger has received clearances from European regulators, and is now being reviewed by the Department of Justice and the Federal Communications Commission as well as the state commissions of Illinois and Ohio. The companies hope to complete the transaction by mid-1999.
NOTE: Copies of written testimony submitted to the FCC by SBC Chairman and CEO Edward E. Whitacre Jr. and Ameritech Chairman and CEO Richard C. Notebaert are available upon request.
CONTACT: Selim Bingol of SBC Communications, 210-351-3991, or George Stenitzer of Ameritech, 312-609-6166/