Sale of Bellcore reported to big research company; 7 Bells cut loose a jointly owned entity

Article Abstract:

San Diego based Science Applications International (SAIC) is set to acquire Bellcore, presently owned by the seven Bell telephone companies. The deal to secure Bellcore, a research organization and software developer, is scheduled to close by Jun 1997. Negotiations are contingent on the two companies obtaining approval from the Justice Department as well as regulators in several states. Completion of the merger will signify the final separation of the seven Bells from Bellcore. The diversity of the seven independent companies has rendered the jointly owned research company virtually ineffective. SAIC will utilize Bellcore's expertise to further its growth in the telecommunications industry. SAIC intends to maintain Bellcore's headquarters in Morristown, NJ, as well as its management staff. Bellcore intends to change its name within a year after the deal closes to alleviate any confusion between it and its replacement, the National Telecommunications Alliance, developed by the seven Bell companies.

Management, Company acquisition/merger, Acquisitions and mergers, Science Applications International Corp., Bellcore

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Rush to wed raises issues on freeing of Baby Bells

Article Abstract:

The merger of Pacific Telesis with SBC Communications and similar mergers under consideration are prompting fears that telecommunication deregulation will reduce competition instead of increasing it. Legal experts, consumer advocates and some government officials fear that if the proposed mergers occur, local telephone service will soon be run by a few, dominant companies, as is currently the case in the long-distance market. The Baby Bells counter by saying that the mergers give them the resources they need to compete in long distance, wireless and television businesses and to compete against huge companies including AT&T and Time Warner. Other analysts claim that fears of anti-competitive consolidation are too extreme, since each company must determine the benefits a merger would bring to their particular situation, and some mergers are already proving difficult to manage.

Forecasts and trends, Industry trend, Local telephone services, Local telephone service, Market Trend/Market Analysis

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Rates increased 5.9% by AT&T, its biggest rise in nearly 3 years

Article Abstract:

AT&T is implementing an overall long-distance rate increase of 5.9%. The policy goes into effect on Dec 1, 1996, and includes a 5% increase in rates for calling card calls, as well as a 2.6% increase for AT&T operator assisted calls. These increases are the most significant jump in rates presented by AT&T since 1994, when the company executed two rate increases of 3.8% and 7.7%. Analysts predict that AT&T will maintain its market share despite these price escalations since the increases are aimed at the company's residential and small business customers, who will notice only slight monthly increases on their bills. Although AT&T continues to lead the long-distance market with $45 billion generated annually, the rate increases may be an indication of the company's concern over its 2.2% rise in long-distance revenues compared with the 7% rise for the industry as a whole.

Prices and rates, AT&T Corp., T, Company analysis, Company pricing policy

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