This News Release: Text | Word97
10/6/99 Statements: Kennard | Ness | Furchtgott-Roth ( Press - Separate ) | Powell | Tristani
Summary of SBC/Ameritech Conditions
Common Carrier Bureau's SBC-Ameritech Merger Home Page
Order: FCC 99-279 - all parts and 10/8/99 statements

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Federal Communications Commission
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This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).

October 6, 1999

News Media Contact:
Mike Balmoris at (202) 418-0253


Conditions Will Create Irreversible Momentum Towards Deployment of Advanced Broadband Services and the Advancement of Local Residential Telecommunications Competition

Washington, DC - Today, the Federal Communications Commission (FCC) approved applications to transfer control of FCC licenses and lines from Ameritech Corp. (Ameritech) to SBC Communications Inc. (SBC) subject to significant, enforceable and unprecedented conditions. The 30 conditions are designed to further open the local markets of these Regional Bell Operating Companies (RBOCs) to competition, stimulate the deployment of advanced broadband services, and to strengthen the merged firm's incentives to expand competition outside its 13 state service area. The FCC found that with these conditions the merger of SBC and Ameritech is in the public interest. Upon consummation of this merger, SBC will control three of the original seven RBOCs (SBC's Southwestern Bell Telephone and Pacific Telesis with Ameritech).

The 30 conditions adopted by the Commission are designed to accomplish five central public interest goals:

  1. promoting equitable and efficient advanced services deployment;
  2. ensuring open local markets;
  3. fostering significant out-of-region competition for the first time by a Bell Operating Company;
  4. improving residential phone service; and,
  5. ensuring compliance with and enforcement of the conditions.
These goals flow from the FCC's statutory objectives to open all telecommunications markets to competition, to promote rapid deployment of advanced services, and to ensure that the public has access to efficient, high-quality telecommunications services.

The FCC's Order found that, absent these conditions, the proposed merger would harm consumers of telecommunications services by:

  1. denying them the benefits of future probable competition between the merging firms;
  2. undermining the ability of regulators and competitors to implement the pro-competitive, deregulatory framework for local telecommunications that was adopted by Congress in the Telecommunications Act of 1996; and,
  3. increasing the merged entity's incentives and ability to raise entry barriers to, and otherwise discriminate against, entrants into the local markets in its region.
On July 1, 1999, SBC and Ameritech supplemented their application by proffering a set of voluntary commitments that they proposed to undertake as conditions of approval of their proposed transfer of licenses and lines. Following a period of extensive public comment on these proposed conditions, the applicants substantially revised their commitments on August 27, 1999, and continued to refine those commitments in subsequent filings.

The FCC's Order also found that the merger would not result in harms to wireless markets subject to divestiture of cellular properties as required by the U.S. Department of Justice and FCC rules. The merged company will be classified as a dominant international carrier in the provision of service on the U.S.-South Africa route (SBC is affiliated with Telkom South Africa, Ltd., the incumbent telecommunications carrier in South Africa). The FCC's Order also found that the merged company is not prohibited by statute from continuing Ameritech's alarm monitoring and cable television operations.

Action by the Commission on October 6, 1999, by Memorandum Opinion and Order, in CC Docket No. 98-141 (FCC99-279); Chairman Kennard and Commissioners Ness and Tristani, with Commissioner Furchtgott-Roth and Commissioner Powell concurring in part and dissenting in part. Commissioners Ness, Furchtgott-Roth, Powell, and Tristani issuing separate statements.