AT&T-BellSouth union stokes user concerns

Customer service, fallout for wireless among issues.

The first reaction by many customers to AT&T's proposed $67 billion buyout of BellSouth last week was this: Is Ma Bell back? But upon reflection they've turned their attention to specific concerns, such as what will become of customer service and the wireless operations and whether the combined carrier's big footprint will benefit them.

The acquisition, if approved by regulators, would create a $120 billion company with about 317,000 employees, the leading share of business voice and data customers, and 71 million residential phone customers in 22 states. The companies have ample resources in common, including shared ownership of wireless kingpin Cingular and the spending of billions of dollars on fiber buildouts designed to deliver voice, data and video to consumers.

Bradner: RBOCs: And then there were three (or maybe one)
Johnson: AT&T/BellSouth: Identifying winners, losers

Although AT&T will have three of the seven Bells under its belt and surpass Verizon to become the largest U.S. carrier, it still won't be nearly as big as the pre-divesture AT&T, a government-sanctioned monopoly that employed 1 million people.

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The first reaction by many customers to AT&T's proposed $67 billion buyout of BellSouth last week was this: Is Ma Bell back? But upon reflection they've turned their attention to specific concerns, such as what will become of customer service and the wireless operations and whether the combined carrier's big footprint will benefit them.

The acquisition, if approved by regulators, would create a $120 billion company with about 317,000 employees, the leading share of business voice and data customers, and 71 million residential phone customers in 22 states. The companies have ample resources in common, including shared ownership of wireless kingpin Cingular and the spending of billions of dollars on fiber buildouts designed to deliver voice, data and video to consumers.

Bradner: RBOCs: And then there were three (or maybe one)
Johnson: AT&T/BellSouth: Identifying winners, losers

Although AT&T will have three of the seven Bells under its belt and surpass Verizon to become the largest U.S. carrier, it still won't be nearly as big as the pre-divesture AT&T, a government-sanctioned monopoly that employed 1 million people.

Still, the new company could be a formidable force for good reasons and bad.

"Anytime there's a consolidation in the telecom industry it's not good for the customers, given we have a small number of large players now," says Dave Dully, CTO at Baptist Health, a Jacksonville, Fla., BellSouth customer.

Others are concerned as well as confused, having barely had time to sort through the AT&T-SBC deal sealed late last year.

"Heads are spinning trying to figure out what this is going to mean," says Terri Staggs, senior telecom analyst at National Gypsum and president of the Enterprise Networking Technologies Users Association. "I'm located in big BellSouth territory and we have services with them, AT&T, old SBC and Cingular," she says.

"One of the big things that's confusing or concerns us is wireless," she says. "We were very big with AT&T Wireless before AT&T divested the company. We incurred a huge expense upgrading hardware because the devices had to have SIM cards that were recognized on Cingular's network. The AT&T Wireless and Cingular merger was horrible."

Staggs says poor communication between the wireless service provider and customers left National Gypsum, a wallboard manufacturer in Charlotte, N.C., concerned that its executives were going to lose international wireless service. This less-than-stellar experience has left Staggs asking: "What other unexpected changes are coming with this merger?"

Wireless is only one piece of the merger that has her concerned. Proposed job cuts and customer contract ownership top her list.

"We already lost our project manager at AT&T with the first round of layoffs post [SBC] merger," she says. "Who am I going to lose next?"

More than 20,000 jobs were put on the chopping block when AT&T and SBC joined forces. AT&T says about 10,000 BellSouth jobs will vanish.

Aside from personnel issues, Staggs is worried how her contracts will be handled.