2005 was a big year for the telecommunications industry – a year in which the number of competing players got smaller. Over the past year, SBC purchased AT&T, changing AT&T’s iconic logo in the process, and Verizon acquired MCI to form Verizon Business. Wireless carriers got involved, too: Sprint purchased NEXTEL, and in October 2004, Cingular (a joint endeavor of BellSouth and SBC) completed their purchase of AT&T Wireless.
The irony about all these mergers is that the United States is only a couple of mergers away from seeing the “Ma Bell” of most of the 20th century reappear. The Justice Department settlement of 1984 broke AT&T up into eight Regional Bell Operating Companies, under the expectation that the new competition would lead to increased customer choice and cheaper phone bills. Since then, the number of players has narrowed significantly due to mergers. Today, of the eight “Baby Bells,” only one, BellSouth, has not merged back into a larger company.
Despite the mergers, we’re fortunate to have a little more choice than we originally did. In addition to a variety of smaller, more independent phone companies (including Hawai’i's own Hawaiian Telcom), cable companies are starting to offer data and voice transmission services. Even Google is getting involved, to an extent – they are purchasing unused “dark fiber” that can connect their data centers together, possibly leading to some sort of ISP service in the future.
I hope that this game of corporation musical-chairs doesn’t end up hurting consumer choice, but I’m not optimistic. I can’t imagine a better way to make money than collecting tolls on the information superhighway.