Chad Clinton

June 21, 2006

WASHINGTON (Dow Jones)--BellSouth Corp.'s (BLS) merger with AT&T Inc. (T) won't re-create the "Ma Bell" of old, according to a document filed Wednesday with the Securities and Exchange Commission.

Ma Bell was the legally franchised, monopoly provider of circuit switched telephone service during most of the last century. "Competition in those markets was a violation of the law," the regulatory filing said.

In the filing, which highlights the benefits of the merger, the company said the merger will "create a company better able to compete across a range of converging and competitive services including video entertainment, broadband, wireless and voice services."

"The era of Ma Bell was devoid of any substantial cable industry, wireless, (voice over Internet protocol), the Internet, or satellite television," which didn't exist then.

BellSouth said that because it isn't an actual competitor in the local, long distance or video market with AT&T, merger won't reduce competition in any of those markets.

The planned $67-billion merger is expected to close by the end of the year, as the deal still needs to win approval from state, federal and foreign regulators.

-By Chad Clinton, Dow Jones Newswires; 202-862-1349; chad.clinton@dowjones.com