From:

"$200 Billion Broadband Scandal"

In 2005, Teletruth filed a complaint with the Federal Trade Commission (FTC to investigate how the previous mergers had harmed fiber optic deployment and competition in America. The data for the complaint was based on specific chapters in "$200 Billion Broadband Scandal". To see the complaint:

The FTC Complaint Against Verizon and SBC

America is 16th in the world in broadband today for a reason. The Bell companies, SBC (AT&T), BellSouth, Verizon and Qwest failed to deliver on the promises to rewire America.

Verizon and SBC Fiber Optic Broadband Spending and Households, Mergers and Broadband Shutdowns. (Source: SBC and Verizon et al.)

 

Money(billions)

Households

Merger

Shutdown

SBC

 

 

 

 

Pacific Telesis

$16.0

5,500,000

1997

1997

Ameritech

$6.6

6,000,000

1999

2000

SNET

$4.5

1,000,000

1998

2000

SBC, Texas

$1.5

 

 

 

Pronto

$6.0

 

 

 

SBC Total

$33.6

12,500,000

Verizon

Bell Atlantic

$11.0

8,750,000

1997

1997

NYNEX (in MA)

$.5

2.000,000

1997

1997

GTE

$4.1

7,000,000

2000

2000

Verizon Total

$15.6

17,750,000

TOTAL

$48.9

36,500,000

The primary finding of our analysis is that at every merger whatever fiber optic based services were being built or deployed were shut down when the ink dried. This impacted 26 states, not including the 28 territories of GTE.

SBC was to spend $33.6 billion and have 12.5 million households while Verizon was supposed to spend $15.6 billion on 17.7 million households. Combined, Verizon and SBC were to spend $48.9 billion and have 36.5 million households by 2000. This was the fiber-to-the-home services we have previously highlighted, using their own data.

  • SBC merged with Pacific Telesis, then SNET, and finally Ameritech (SBC was originally Southwestern Bell), and finally AT&T.
  • Verizon mergers were Bell Atlantic with NYNEX and then GTE, and finally MCI.

But that was only part of the story. SBC and Verizon were also supposed to compete with each other for local phone service. SBC promised to compete out of their own regions in 30 cities by 2000, Verizon was to be in 21 cities in 18 months. And, as we show, they never fulfilled virtually any of these plans, even though their merger plans were all based on competing with each other.

Teletruth has subsequently filed a complaint with the FTC, calling for an investigation into each of the previous mergers for using false, misleading and deceptive speech to make the mergers occur.

But don’t take our word for anything. Simply read what was promised and what was delivered to make up your own minds. Or at least consider these chapters a cautionary tale of what to expect in the future, especially with the Bell companies’ new conquests of AT&T and MCI.