MaBell Reborn

The merger of BellSouth and AT&T would create a near facsimile of the old Ma Bell, and it will have tremendous powers. And that may not be such good news for some start-ups, and equipment suppliers.

“It is ironic that market forces are putting back together what the Justice Department broke up with the Judge Greene consent decree (in 1984),” says Sanjay Subhedar, a telecom veteran and now a general partner with Palo Alto-based (and telecom focused) venture capital firm, Storm Ventures.

“This enhanced ability to drive a hard bargain would affect pretty much any company that AT&T-BellSouth does business with, particularly hardware and technology suppliers,” says Cynthia Brumfield of Emerging Media Dynamics. While the consolidation of customers means more buying power, it also means more spending and bigger budgets for new technology architectures. Industry experts believe that the suppliers of new-fangled metro-ethernet gear will come out ahead as a result of this merger.

To read my full story, visit CNN Money. Read all about the possible impact on how the industry will shakeout in months to come, and how Verizon is going to react.

Also, AT&T To Buy BellSouth

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