STATEMENT OF 
COMMISSIONER MICHAEL J. COPPS, CONCURRING
Re:  In the Matter of AT&T and BellSouth Corporation Application for Transfer of 
Control (WC Docket No. 06-74)
We celebrate today not a triumph for huge corporate mergers but a modest victory 
for American consumers.  The AT&T-BellSouth transaction is the largest 
telecommunications merger ever, the latest in a litany of former Bell Company mergers 
that has gone on for nearly a decade.  When it comes to consolidation among 
communications giants, we operate in a world that is certainly not of my choosing.  Nor 
do I think it is what Congress had in mind when it passed the Telecommunications Act of 
1996.  That particular Congress intended to create a pro-competitive, deregulatory 
communications environment.  In the past several years, the FCC has been disastrously 
selective in its reading of this two-fold charge.  We couldnt act quickly enough to 
approve every call to deregulate, but we studiously avoided our obligation to encourage 
the kind of fair competition necessary to protect consumers in a deregulated world.  I 
have made my disaffection with this course of Commission decision-making clear ever 
since I came here more than five years ago.  But as I have said before, in the end we are 
charged with considering these mergers in the context of the world that is, not the one 
that might have been.  With that as prologue, I began my consideration of this transaction 
wondering if there was some equation by which I could support the combination before 
us todaysome way to ensure that consumers actually derive tangible value instead of 
being left once again holding the bag of higher prices and less competition.
We embarked upon a strange and tortured odyssey in October when the U.S. 
Department of Justice incomprehensibly concluded that it had no concerns about the 
AT&T/BellSouth merger. Instead of providing a reasoned analysis of the effects this 
unprecedented merger might have on the highly-complicated and increasingly 
concentrated telecommunications market, all DOJ could produce was a hear no evil, see 
no evil, speak no evil press release.  Surreal as that was, we Commissioners were 
initially asked to approve the merger the very next day without a single condition to 
safeguard consumers, businesses, or the freedom of the Internet.  This is all the more 
astonishing when you consider that this $80-some odd billion dollar acquisition would 
result in a new company with an estimated $100 billion dollars in annual revenue, 
employing over 300,000 people, owning 100% of Cingular (the nations largest wireless 
carrier), covering 22 states, providing service to over 11 million DSL customers, 
controlling the only choice most companies have for business access services, serving
over 67 million access lines, and controlling nearly 23% of this countrys broadband 
facilities.  
It became clear to Commissioner Adelstein and me that if there were going to be 
any consumer-friendly results from the transaction, it would be up to us to represent and 
deliver upon the many concerns that consumers had expressed to the Commission. To 
make matters still worsein a farce transcending the comedic, we were expected to 
negotiate for safeguards without knowing who of the Commissioners were actually 
2
participating in the proceedingan ambiguity that could have been resolved months 
earlier but for the alleged strategic benefits of creating uncertainty in the process and the 
outcome.  Fortunately, just two weeks ago, this progress-inhibiting underbrush was 
finally cleared away and we were able to accelerate the job of reaching an outcome.
From the start I made plain to all parties and stakeholders that it would be a very 
steep hill for me to climb to support a merger of this magnitude and consequence.  
Meeting with the parties, I raised many concerns that questioned whether the merger 
would be consistent with the public interest and represent an improvement over the status 
quo.  
Before creating the largest Internet access provider in history, there was the 
glaring need to ensure this merger would not usher in an age of discrimination on the 
Internetthat wonder of technology whose freedom and openness is so dramatically 
refashioning all of our lives.  It was time to add a fifth principle of neutrality to protect 
the huge network the merged entity would control.  How could we be party to a 
transaction that would enhance both the capacity and the commercial incentive of the 
new company to discriminate on the Net?  History, it seems to me, documents that when 
a firm has both the technological ability and the business incentive to control a network 
to its own advantage, it will at some point attempt to do just that.   
We also heard the pleas of consumers, small businesses and others that this 
transaction should bring tangible gains in terms of services and prices to them and bring 
them now, not at some promised future date.  A company this deeply involved in 
controlling telecommunications networks should also be expected to do its part to ensure 
that broadband is deployed more quickly throughout the nation, including to rural 
America and other under-served parts of the country.  Finally, before accumulating 
enormous additional market power in the special access market, the company should 
address the well documented concern that businesses are being charged inflated prices for 
high-volume voice and data servicesbehavior that retards small business growth, 
inhibits Americas international competitive posture, and eventually trickles down to 
consumers in higher costs.
Over the course of the intensely-busy weeks and months since we were asked to 
approve a condition-less merger proceeding, I have had wide-ranging discussions with 
many, many stakeholders that have been useful, substantive and productive. Mergers of 
this magnitude cannot and should not be considered without ongoing consultation with as 
many stakeholders as possible.  This is what Commissioner Adelstein and I fought for 
and we were pleased when the Chairman provided, at our request, an additional period of 
public comment during the course of our deliberations.  Indeed, I believe that this 
proceeding has allowed for more comment and sharing of knowledge by interested 
parties than any merger consideration that I have participated in during the five years I 
have served on the Commission.  Its still short of a perfect process, but like the merger 
result itself, it ended better than it began. 
After much hard work and countless hours of deliberation on all sides, the 
3
applicants have now offered unprecedented and substantial commitments that I believe 
will safeguard and serve the public interest to a degree few envisioned at the time the 
merger item was presented to the Commission.  Would I have preferred to do even more?  
Of course.  Am I entirely satisfied?  No.  Do I agree with much of the analysis contained 
in the Order?  Decidedly not.   The analysis falls far short of the mark in many important 
respects.  This is a major reason for my concurrencewhich is predicated on voting for 
the overall results of the Order, including the commitments the applicants have made,
without endorsing all of the reasoning set forth in the Order. But I do believe the overall
outcome is a genuine step forward on the fronts I enumerate below.  I believe that the 
commitments concerning the future of the Internet; consumer access to broadband, video, 
and advanced wireless services; business prices for high-volume voice and data services; 
competitor access to UNEs and interconnection; public safety and disaster relief; and the 
repatriation of jobs to the United States comprise a package that will benefit the 
American public for years to come, and I am pleased to have worked toward this end.  
And the conditions are expressly enforceable by the Commission.  The results we 
approve today allow me to concur in this Order.
I should make clear that this is a package of commitments composed of many 
individual elements.  Not every Commissioner has equal enthusiasm for each element of 
the final item, so I am grateful for my colleagues willingness to look at the package as a 
whole in order to produce a majority to approve or concur in the result we reach today.  I 
think it is a real credit to the strength of the institution and the working relationships we 
have forged that we have been able to reach this result.
Network Neutrality. Perhaps most important, we have taken steps that will 
preserve and encourage the truly transformative openness and power of the Internet.  The 
Internet is surely this generations most transformative technologyperhaps as 
transformative as any technology in history.  It was conceived and nurtured in freedom 
and it empowered not those who controlled the pipes but those at the edgesconsumers, 
you and me.  I know there are some who still believe that the government has no business 
overseeing any aspect of the Internet (ignoring, of course, government's formative role in 
creating the Internet in the first place).  Their theory is that technology mandates from on 
high will inevitably stifle innovation and are antithetical to the de-centralized, non-
hierarchical genius of the Internet.  My response is that in an age when the Internet is 
increasingly controlled by a handful of massive private network operators, the source of 
centralized authority that threatens the Internet has dramatically shifted.  The tiny group 
of corporations that control access to the Internet is the greatest threat to Internet freedom 
in our country today.  If left unchecked, the merged entity resulting from todays decision
would have gained the ability to fundamentally reshape the Internet as we know itin 
whatever way best serves its own profit motives, rather than preserving the integrity and 
the effectiveness of the Internet.  
The condition builds upon the four principles of net neutrality unanimously 
adopted by this Commission and made enforceable in the context of the Bell mergers 
completed last year.  In addition to the companys compliance with these four principles, 
the condition agreed to by the merged entity includes a fifth principle that requires the 
4
company to maintain a neutral network and neutral routing of internet traffic between 
the customers home or office and the Internet peering point where traffic hits the Internet 
backbone. The company is prohibited from privileging, degrading, or prioritizing any 
packets along this route regardless of their source, ownership, or destination.  This 
obligation is enforceable at the FCC and is effective for two years.  It ensures that all 
Internet users have the ability to reach the merged entities millions of Internet users
without seeking the companys permission or paying it a toll.  The next Drudge Report, 
Wikipedia, Craigslist, Instapundit, or Daily Kos should not have to seek a massive 
corporations blessing before it can begin reaching out to the American public, and we
can take considerable comfort from the fact that todays condition prohibits such 
behavior.  While I might have preferred a longer duration, prior mergers resulted in 
similar time periods for the net neutrality conditions and it is in my view sufficient to 
allow Congress to take longer-term network neutrality action if it chooses to do so.  
Relatedly and importantly, the merged entity is required to continue to maintain 
the present number of Internet backbone peering relationships for the next three years. 
Thus the status quo in the Internet backbone market is preserved by preventing the 
merged entity from using its larger size and immense last-mile customer base to 
terminate the settlement-free peering relationships that are fundamental to the Internet as 
we know it.  Read in conjunction with the network neutrality obligation, this peering 
provision will help to protect the Internet experience and the powerful opportunities it 
promises for the future. 
Consumer Benefits. This Order clearly prevents the merging parties from tying 
their Internet access service to the purchase of traditional telephone service.  Additionally 
the merged entity commits to offer stand-alone DSL service at a more consumer-friendly 
price of $19.95/month.  This should prove an enormous boon to customers who are happy 
with their wireless service and seek to cut the cord on wireline telephone service, or 
who want to take advantage of competing VoIP services that have the potential to lower 
consumer phone bills.
At a more macro level, I have long maintained that consumers have been sorely 
burdened by our nations lack of a national broadband strategy.  Today, large swaths of 
rural America, low-income areas, and other underserved populations lack access to 
affordable broadband services, and our nation ranks 16th in the world in broadband 
penetration according to the International Telecommunications Union (ITU).  In a more 
recent and nuanced ITU Digital Opportunity Index, the United States ranks 21st! These 
are not rankings to be proud of.  There will be no end to this downward spiral absent a 
comprehensive national strategy to reverse itjust as every other industrialized country 
on the planet has developed its own national broadband strategy.  But, again, the focus of 
todays merger proceeding cannot be on what might have been, but rather on making sure 
that our Commission action doesnt make an already bad situation even worse. So, even 
though we cannot promulgate such a broad strategy, we do secure in this merger real, 
tangible, and important broadband commitments that will ensure that this mega-merger 
does not send us even further in the wrong direction and, yes, even tips the balance a bit 
in the right direction.
5
First, the merged entity has committed to offer broadband to 100% of the 
customers in its 22-state region by the end of 2007.  There are no exceptions for sparsely 
populated areas; in fact, the company has committed that at least 30% of its new 
deployment will be in rural and low income areas.  Would I have liked this commitment 
to apply to the faster speeds of fiber rather than to copper wire? Absolutelybut this is 
at least a credible commitment and a tangible beginning.  And the company has agreed to 
at least accelerate its fiber build-out for the AT&T region by acknowledging its intention 
to pass at least one and a half million homes in the BellSouth region with fiber facilities 
by the end of 2007.  The new company will need to come back to the FCC at the end of 
next year to tell us whether it has met its responsibility.  I, for one, will be watching 
closely to ensure that it does.
Second, in terms of affordable broadband, the company has agreed in its 22 states 
to offer new retail consumers its basic broadband service for $10 per month as well as a 
free modem to current dial-up customers in order to make broadband affordable and 
available to many more people than have it today.  Put this commitment together with its 
broadband deployment obligation, its $19.95 Stand Alone DSL commitment, and its 
commitment to preserve network neutrality, and I believe we have a framework that will 
help provide affordable, user-friendly broadband for consumers around the country.
Third, the more this agency can do to spur third pipe options for competitive 
broadband services, the better.  Without conditions the merged entity would have held 
onto spectrum that it has not substantially developed but that is uniquely suited to 
wireless broadband applications.  We know the merged entity will have little business 
incentive to invest in building out this spectrum, because doing so would just cannibalize 
its wireline broadband offerings as well as the broadband wireless services it offers 
through Cingular. I am therefore pleased that the company has agreed to divest its 2.5 
GHz spectrum licenses within 12 months and to use its 2.3 GHz spectrum licenses in a 
timely manner or forfeit this spectrum as well.  In doing this, we have taken substantial 
steps to enable entrepreneurs to use their talents to develop new, exciting wireless 
broadband applications and we have ensured that the new company has the right 
incentives to innovate with the spectrum it retains.
In crafting a set of measures to avoid the new companys abuse of its Internet 
market power, we have also taken pains to preserve competition in the very important 
market for plain old voice servicewhich is still one of the more daunting bills that 
American households must pay each month.  One bright spot on the FCCs radar screen 
is the progress that cable and other competitive providers are making through offerings of
facilities-based telephone service to residential customers.  This merger initially raised 
the specter of a consolidated entityone owning nearly all of the telephone network in 
roughly half the countryusing its market power to reverse the inroads that new entrants 
have made and, in fact, to squeeze them out of the market altogether.  To mitigate this 
concern, the merged entity has agreed to allow the portability of interconnection 
agreements and to ensure that the process of reaching such agreements is streamlined.  
These are important steps for fostering residential telephone competition and ensuring 
6
that this merger does not in any way retard such competition.  
Benefits for Enterprise Services: Todays Order makes substantial strides in 
limiting the merged entitys ability to use its stranglehold over business access services in 
22 states to raise prices for special access to even more unreasonable heights. Nowhere is 
the FCCs folly in de-regulating without ensuring competition more apparent than in the 
special access market.  As the Government Accountability Office (GAO) recently pointed 
out, only 6% of buildings with demand for special access services have any competitive 
alternative besides the incumbent LEC.  Indeed, the GAO report concludes that the 
FCCs de-regulatory price flex regime has actually led to higher prices in the very areas 
where one would ordinarily expect to find lower prices.  Todays Order helps restore 
balance by reinstituting price caps throughout the 22 state footprint of the merging 
partiesa measure that should result in approximately $500 million in savings to 
competitors.  The Order also prohibits reliance on certain anti-competitive contract 
conditions.  Importantly, these protections are in effect for a period of four years. While 
this is real progress, we still have far to go.  It is time for the FCC to finish its long-
dormant special access proceeding that has been languishing for years.
Additional Benefits: A detailed reading of the merged entitys commitments will 
show other important benefits in addition to the ones I have already described.  Let me 
briefly highlight just a few of these.  Because the loss of jobs is so often the first cost-
cutting move of any merger, I am pleased at the companys willingness to repatriate 
approximately 3,000 jobs from overseas back to the United States, with at least 200 jobs 
being created in the hurricane-ravaged area of New Orleans.  I believe this commitment 
is the first such job repatriation ever to accompany a telecom merger.  While I fear other 
jobs will be lost, this provides at least some job comfort for the companys employees.  
The revolution in communications that we are witnessing must not come at the expense 
of Americas hard-working communications workers.  Indeed, these high-quality, 
dedicated, and organized workers are key to bringing us the next generation of 
communications services. 
I am also pleased that the merged company has made public safety commitments
that will help protect our nations communications networks in the event of a natural or 
man-made disaster.  As I have often stated, providing for the safety of the people is the 
most important role that a government can fulfill.  So I am pleased that the merged 
company will ensure that legacy AT&Ts first-rate disaster recovery resources will now 
be made available in the former BellSouth states.  The company should be commended 
for developing these advanced capabilities beyond any government mandate to do so, and 
I believe that expansion of this capability to an additional broad swath of the nation is an 
important step forward in readying ourself for the next disaster. I have also stated that 
the FCC should lead the charge in securing the security, reliability, and robustness of our 
networks, including through public-private partnerships.  Towards that end, the merged 
company will donate $1 million to non-profit or public entities for the purpose of 
promoting public safety.
7
Our disabilities communities get easily left behind in such huge transactions.  So I 
am pleased that the merged entity has agreed to produce an important report on its service 
to consumers with disabilitiesa report that can help the Commission in its mission, 
mandated by statute, to ensure the availability of effective and comparable
communications tools to all our people. I should note that Cingular Wirelesswhich 
will now be owned wholly by the merged entityhas distinguished itself in its 
willingness to work with us on disabilities and public safety issues.  I look forward to 
continuing that relationship in the years ahead, as well as to learning what new initiatives 
and policies the merged entity will pursue to make sure that every American has access to 
the wonders of the communications revolution.
Further, in what many might see as a very technical agreement, but an important 
one nonetheless, the company has agreed not to use our forbearance procedures to evade 
or frustrate any of the commitments it has made here.  We have also been quite cognizant 
in recent months of the Tunney Act proceeding concerning the prior merger between 
SBC and AT&T that is currently pending in district court.  While the resolution of this 
issue will ultimately be between the federal courts and the Justice Department, I do 
believe the FCCs public interest review of this merger must take into account a concern 
about whether the ultimate decision in the prior mergers will be reflected in this current, 
related merger.  To alleviate this concern, the company has agreed to come back to the 
FCC after the courts and the Justice Department have resolved the pending proceeding to 
work with us in good faith to ensure that any remedies ultimately imposed in the prior
merger are adequately addressed here.  
In sum, I believe that we have made this transaction at least minimally acceptable 
to American consumers.  It brings price reductions rather than price increases, more 
broadband rather than less, a free and open Internet rather than one rife with opportunities 
to degrade and limit, and numerous other safeguards and protections.  
I would be remiss in not expressing gratitude to all parties who participated in 
these discussions.  So I thank them one and all.  I wish to thank the Chairman and 
Commissioner Tate who have spent so much time and energy on this transaction for so 
many weeks and months.  It detracts from no one's effort to pay special thanks to my 
friend and colleague Commissioner Adelstein for vision and perseverance that were so 
important in getting us where we are today.   My colleagues personal staffs worked long 
and hard to get this done and we appreciate particularly the long hours and excellent 
contribution made by Scott Bergmann of the Adelstein Office.  I am grateful to the 
Bureau for all the work it has done during the course of this proceeding. Most of all, I 
thank my dedicated, hard-working and downright brilliant staff for their tireless exertions 
during the pendancy of this proceeding.  Scott Deutchman, joined by Bruce Gottlieb, 
worked literally around the clock on many occasions.  They gave up family vacations, 
sacrificed holidays, and pushed themselves far beyond what anyone should rightly 
expect.  Their good judgment, always-incisive analysis and remarkable outreach skills are 
a huge reason why this agreement was reached.