By KEN BELSON
The New York Times March 6, 2006
The AT&T Corporation, in announcing plans yesterday to buy BellSouth Corporation for $67 billion after months of speculation, took the offensive against low-cost rivals in the free-for-all for phone, wireless and television customers.
With cable providers and technology companies entering the phone business, the former Baby Bells starting to sell television programming and more and more services available on mobile phones and on the Internet, companies like AT&T are trying to bulk up and turn themselves into one-stop shops for all communications needs.
"We literally have hundreds of competitors coming in every day; it's nothing like the old days," said Edward E. Whitacre, Jr., the chairman and chief executive of AT&T, the country's largest phone company. "If we're going to have the strength to compete, we better get our companies together."
The new company, with $120 billion in sales, about 317,000 workers and
71 million local phone customers in 22 states, would recreate a big chunk of the former AT&T monopoly that was broken up a generation ago. With the deal, only three Baby Bells would remain: AT&T, the former SBC Communications that provided service in the Southwest and elsewhere; and Qwest and Verizon, the $90 billion company which is AT&T's chief rival. The latter two might now face renewed pressure to build themselves up.