Bell Atlantic and GTE Merger Promotes Vigorous Competition in Communications Markets
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Bell Atlantic and GTE Merger Promotes Vigorous Competition in
Merger Partners Respond to Critics in Filing with FCC
December 23, 1998
Susan Butta, Bell Atlantic,
WASHINGTON - Bell Atlantic (NYSE:BEL) and GTE Corp.
(NYSE:GTE) today will file reply comments with the Federal
Communications Commission (FCC) on their proposed merger, saying the
transaction would ignite nationwide competition in local, long distance,
wireless, Internet and data communications services.
Responding to comments filed by opponents to the merger, the companies
says that the most vociferous objections have come from competitors who
stand to lose the most from a combined GTE-Bell Atlantic's ability to
offer a 'bundle' of advanced data, voice, and Internet services to
customers throughout the country. Having merged their way into a
position to participate in this rapidly emerging new communications
industry, AT&T, MCI WorldCom and Sprint are now attempting to fend
off, for as long as possible, the full competitive potential of a united GTE-
The filing demonstrates that the merger of GTE and Bell Atlantic presents
no risk of diminished competition that could eclipse the pro-competitive
gains it will bring to consumers of local, data, long distance, and Internet
services throughout the nation. Therefore, the companies explain that the
merger is decidedly in the public interest because it will produce dramatic
pro-competitive benefits in every telecommunications market.
Benefits of the merger outlined by the companies in a previous filing (Oct.
2) at the FCC included:
National Bundled Services Competition
The merger, the companies said in the filing, will add an important new
competitor to the ranks of national and global providers that can offer
consumers a full bundle of advanced communications services. Today,
only a few players are positioned to offer such packages, including AT&T,
MCI WorldCom and Sprint. The merger of Bell Atlantic and GTE will
bring a new competitor into that arena with the necessary scale and scope
to participate in this emerging market.
Local Service Competition
The new company created by the merger of Bell Atlantic and GTE will
have a far greater ability to enter and compete quickly and effectively in
key markets outside Bell Atlantic and GTE's current service areas. Local
exchange customers in GTE's and Bell Atlantic's current service
territories will also benefit from the combined company's ability to
compete with others on price, service quality and range of product
Internet Services Competition
The merger will greatly enhance the competitive strength of GTE's
Internet backbone and data services and by doing so will promote healthy
competition in these critical new markets. The merger will allow the new
company to be a much more potent competitor in this market with:
> The scale and scope necessary to compete effectively with the small
number of dominant backbone providers and to protect the
competitiveness of the Internet, and;
> The rollout of new Internet products and services that will stimulate the
wide scale deployment of new services, the creation of vibrant new
markets and the entry of new competitors.
Long Distance Competition
Today, there are only three fully national facilities-based carriers, AT&T,
MCI Worldcom, and Sprint, which happen to be the most vocal opponents
of the GTE-Bell Atlantic merger. This merger will create a fourth. The
merger will allow GTE-Bell Atlantic to provide national facilities-based
long distance service more quickly and efficiently than either could alone.
As a result of this merger, the new company can offer a broader range of
services more efficiently to the benefit of its customers.
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EDITOR'S NOTE: GTE and Bell Atlantic announced a merger of equals
of July 28, 1998. A complete copy of today's filing with the FCC is
available from the press contacts listed on this release.
# # #