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Friday, May 12, 2006

Privacy benchmarks ... a new line of merger attack?

By now, you all know that AT&T, BellSouth, and Verizon have been secretly handing over billions of call records to the federal government.

Only Qwest asked for DOJ or FISA court confirmation that providing this data would be lawful. Kudos to Qwest, as it shows that the house cleaning it went through actually resulted in some pretty effective controls.

In the late 90s, FCC merger analysis considered the "comparative benchmark" affect of mergers. As an industry segment consolidates, there are fewer companies (benchmarks) that policy makers can compare to determine what's reasonable for the industry. With multiple players in a segment, it's easier for the FCC to get a sense of what's what.

Yesterday's revelation that the country's biggest phone companies are routinely handing over massive amount of customer data should spur privacy rights advocates and consumer groups to bring comparative benchmark issues to the forefront of the FCC's analysis of the proposed AT&T/BellSouth merger.

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