PCAN Challenges Bell Atlantic-GTE Merger, Cites Risks to Consumers

Strategic Insights -

The Pennsylvania Consumer Action Network (PCAN) distributed flyers on April 1, cautioning against the pending Bell Atlantic-GTE merger. PCAN members handed out the flyers as part of their annual April Fools' Day tradition, highlighting how corporate mergers often lead to higher prices, worse service, and job losses for middle-income workers. The flyers contrasted the promised benefits of deregulation with the actual outcomes, pointing to the negative impact on consumers. PCAN spokesperson Alec Meltzer emphasized the need for consumers to speak out against the merger, citing the dramatic increase in corporate profits and the job cuts that follow most mergers.

Key Takeaways:

  • PCAN challenged the Bell Atlantic-GTE merger as bad for consumers, citing higher prices, worse service, and job losses.
  • The flyers were part of PCAN's annual April Fools' Day tradition, highlighting the negative consequences of corporate mergers.
  • Deregulation of the telecommunications industry led to increased prices and decreased service quality, with benefits mostly going to big business.
  • Corporate mergers have risen to an all-time high, with 1529 mergers in 1991 and 3702 mergers in 1997 (a 142% increase).
  • The three largest telecommunications mergers in progress would control 25.1% of the world's market, according to the Organization for Economic Cooperation and Development.
  • Jobs were cut in almost all mergers, with the majority of job losses at low and middle-income levels.
  • Corporate profits have risen dramatically with the mergers, while consumers suffer the consequences.

Statistics:

  • 1529 corporate mergers in 1991 (Federal Trade Commission)
  • 3702 corporate mergers in 1997 (Federal Trade Commission)
  • 142% increase in mergers from 1991 to 1997 (Federal Trade Commission)
  • 25.1% of the world's telecommunications market controlled by the three largest mergers (Organization for Economic Cooperation and Development)
  • Jobs cut in almost all mergers, with majority at low and middle-income levels (no specific figure given)

Sources:

  • PCAN (not dated)
  • Federal Trade Commission (not dated)
  • Organization for Economic Cooperation and Development (not dated)