| BUSINESSWEEK ONLINE : FEBRUARY 22, 1999 ISSUE | ||||||||
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| INTERNATIONAL -- READERS REPORT
A Dangerous Buzz on the Lines (int'l edition) I read with interest ''Megamergers are a clear and present danger'' (Economic Viewpoint, Jan. 25). Jeffrey Garten is right: Megamergers are a danger not for the U.S. but also for other countries. But there are some aspects that shouldn't be neglected. For instance, economies of scale. Look at the low rates that AT&T is charging for its mobile communications throughout the U.S. That's why Bell Atlantic Corp. offered $45 billion for AirTouch Communications Inc. in an attempt to create a nationwide mobile network able to compete with AT&T. Bell Atlantic failed, but Britain's Vodafone succeeded, and acquisition of Air Touch will create a worldwide, not merely nationwide, mobile network. The results could be lower tariffs--and increased pressure on fixed telecommunications operators, also in megamerger fever. Telecommunications are facing a transition period after market liberalization. Liberalization has started a globalization race in which M&A is one path. A strong market consolidation, the result of a lot of M&A, could replace old state-owned (national) monopolies with a world monopoly. This could be a real danger! Nicolae Oaca Bucharest _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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