Monopolies and U.S. Anti-Trust Policy
Discusses the U.S. government's response to Verizon Communications, Inc.'s and MCI Inc's intentions to merge into a single telecommunications provider.
# 65856 | 1,387 words | 5 sources | MLA | 2006 |
Published on May 21, 2006 in Business (Companies) , Law (Business) , Political Science (U.S. Federal Politics)
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This paper begins with a discussion of the potential monopolistic practices that could arise from a merger between telecommunications providers Verizon Communications Inc and MCI Inc. The paper then examines the U.S. government response to such a merger and why the government is correctly concerned about preventing a monopoly in the telecommunications industry.
From the Paper:"When Verizon Communications, Inc. ("Verizon") and MCI, Inc. ("MCI") announced their intentions to merge into a single telecommunications provider, the Federal Communications Commission and the Antitrust Division of the Department of Justice took immediate notice. The government's quick response to such potential threats to competitive markets is perhaps due in part to the history of the telecommunications industry and, in particular, the role of the government in allowing the monopoly to continue for so long. Beginning in 1907, AT&T operated as a legally sanctioned monopoly. AT&T's then-president Theodore Vail argued that due to AT&T's advanced technology, it would be the most efficient provider of telecommunications services and would thus emerge as a natural monopoly. The government was convinced by this argument until 1974, when the United States filed a suit that was settled eight years later and required AT&T to divest itself of the Bell operating companies that provided local phone service."
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