Abstract
The active merger and acquisition activity we have seen in the
telecommunications service provider market in recent years has rewarded the
aggressors with strong brand recognition and confidence among customers, as
well as potential customers. In this evolving environment, scale matters! AT&T
and Verizon have left other players behind when it comes to confidence in
their role as a provider of networking, security and convergence solutions,
with AT&T consistently in the leading position in the enterprise business
space. This differentiation is most evident in the area of managing network
needs, where existing customers of BellSouth, Qwest, and Sprint rate AT&T
and/or Verizon more favorably than their own provider.
As the number of major service providers of telecommunications voice and data
shrinks due to merger and acquisition activity, brand equity becomes more
critical in attracting and retaining business customers. When the planned
acquisition of BellSouth by AT&T takes place later this year, the original
seven "baby bells" will have shrunk to two major players (Verizon and AT&T)
and Qwest, which operates in the smallest of the original Regional Bell
Operating Companies (RBOC) territories, formerly known as US WEST.
It will become increasingly difficult for Qwest and Sprint to compete for
attention and market share as Verizon and AT&T continue to leverage the
strength of their nationwide capabilities both within and outside of their
incumbent service areas
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