^{Democracy & Technology Blog} “There you go again”

One of history’s great propaganda experts believed that if you repeat a lie often enough it becomes the truth. A lot of politicians follow this advice.
The Consumers Union and the Consumer Federation of America endlessly wave the same bloody shirt of higher phone rates. The latest incantation is:

“If approved, [the] merger [between AT&T and BellSouth] will lead to higher local, long distance and cell phone prices for consumers across the country.”

This is absurd because AT&T and BellSouth do not compete against each other for local or mobile phone services. And any competition between them in long distance is de minimis. The consumer groups see these companies as potential competitors. They have argued unsuccessfully for years that antitrust enforcers should take a more active role protecting and nurturing potential competition. This would require a clairvoyance that government simply does not possess.
The consumer groups also repeat their second most frequent remark:

“Telecommunications has now gone from a regulated monopoly to an unregulated duopoly with just two major players.”

The implication seems to be that there is barely any difference between a monopoly and a duopoly. Sometimes that’s true, but a fact-specific analysis is required. The answer depends on the barriers to entry. Telecom used to bear the hallmarks of a “natural monopoly” where the barriers were very high. But technology has led to plummeting costs for network equipment and Congress eliminated the legal barriers in 1996. So any company who abuses a dominant position will simply invite competitive entry.
VoIP and cellphones are destroying traditional wireline phone services as the phone companies invest everything they can to become broadband providers. This has got to be one of the most dynamic markets in the world today. Why would anyone want to turn back the clock?