* AT&T, MCI seem ripe for the picking, but RBOCs say they are not shopping
Despite reports that AT&T and MCI are preparing to seek or are actively seeking buyers, the RBOCs are all but ruling themselves out as potential suitors.
SBC and BellSouth both said last week they have their hands full with Cingular Wireless’ $41 billion acquisition of AT&T Wireless. SBC and BellSouth jointly own Cingular.
And Verizon, which is reportedly looking to acquire Vodafone’s stake in Verizon Wireless, made no mention of an interest in acquiring an interexchange carriers (IXC) at last week’s Goldman Sachs Communacopia conference in New York, where CEOs of the three RBOCs spoke. AT&T President David Dorman canceled his speaking engagement at the conference at the last minute, just before AT&T announced that it was laying off 20% of its 61,600 employees this year instead of the previously announced 8%, and writing off $11 billion in assets as it exits consumer telephony.
Published reports have speculated that AT&T is trimming down in order to attract buyers as long-distance voice and data become less profitable, and recent court rulings are likely to raise the price of wholesaling access facilities from the RBOCs. The latter situation prompted AT&T to exit consumer telephony.
MCI, meanwhile, already has confirmed that it is seeking an acquirer. It is believed the RBOCs would be interested in the interexchange carriers (IXC) to expand their presence in nationwide enterprise data services such as frame relay and IP VPNs.
But SBC and BellSouth say they are not.
“Consolidation would be helpful” to raise SBC’s profile in the enterprise telecom market “but that’s not in our plan,” SBC Chairman and CEO Ed Whitacre said at the Goldman Sachs conference.
Similarly, BellSouth “certainly has enough on its plate right now” with regard to the Cingular/AT&T Wireless merger, says BellSouth CEO Duane Ackerman. BellSouth and AT&T had courted each other earlier last year, but a deal fell apart when the parties could not agree on a price.
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