The New York Times makes all the right arguments against the AT&T/BellSouth merger:
One of the pillars of the argument for letting AT&T and BellSouth merge is the strength of the Internet telephony companies, which compete with them in offering phone services. Yet once the bigger and better AT&T had approval from Washington, what incentive would it have to allow competition with its phone services in its newly expanded market? None.
Internet service providers like AT&T are already hoping to create a tiered system, adjusting the speed of a connection to a Web site and its content according to how much the company pays. They want to be paid not only by their subscribers, but also by the companies supplying the Web site material, especially for large files like music and video clips.
Right now there's no data discrimination. That system has been a runaway success, but the urge to squeeze out a little more money has begun to endanger it.
The chief executive of AT&T, Edward Whitacre, told Business Week last year that his company (then called SBC Communications) wanted some way to charge major Internet concerns like Google and Vonage for the bandwidth they use. "What they would like to do is use my pipes free, but I ain't going to let them do that because we have spent this capital and we have to have a return on it," he said.
It's an easy step from toll collector to bouncer. While Internet services providers would probably not block access to the sites of competitors and of those who cannot afford to pay a premium, the providers could shunt them over to a tier of service so slow that it would make them uncompetitive. And since much of the country has only one or two options for high-speed Internet service to start with, that could make customers' choices for them.
And, meanwhile, the various telecom and cable companies are battling tooth-and-nail to keep municipalities from offering their own internet infrastructures. So not only do giants like AT&T get to complain that they deserve full freedom to use their private lines as they see fit, but they also get to demand that no companies or entities with a more publicly-oriented outlook can compete with them. It's the free market at its finest, and if regulators don't do their jobs and stop AT&T and BellSouth, it's going to get a lot finer, at least for the executives and shareholders involved. As for the rest of us, well, you weren't that into YouTube anyway, were you?
