US lifts legal barriers to telecoms mergers

Click to follow
The Independent Online
A NEW telecommunications policy designed to eliminate legal barriers between the US telephone and television industries will be unveiled today by the Clinton Administration in a bid for cross-industry competition.

Al Gore, US vice-president and the government's most vocal advocate of the 'information superhighway', is to endorse the repeal of laws that exclude telephone utilities, cable TV companies and long- distance communications carriers from each another's markets.

The policy will allow a number of proposed mergers, such as those involving Bell Atlantic and Tele- Communications as well as BellSouth and Cox Cable, and could encourage further consolidation in US telecommunications.

Mr Gore is also expected support a 'two-wire' policy, which would prohibit any company from monopolising both telephone and cable services in a given area.

Congress has tried for several decades to limit the diversification of telephone utilities and, more recently, cable-TV providers, arguing that their monopolies afford them unfair advantages over rivals.

But technological changes have blurred the lines between the industries, while making it easier for competitors to enter their traditional markets. At the same time, both industries acknowledge that they lack the technical expertise and the financial resources to develop a national interactive telecommunications system alone.

Several bills are already before the US Congress advocating deregulations along these lines, and the acting head of the US Federal Communications Commission has backed similar changes to existing regulations.

Comments