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FCC and Mergers

The Communications Act of 1934 established the Federal Communications Commission (FCC). Its main purpose back then was to control and regulate all means of communication, from radio, television, wire, satellite, and cable. It is governed by five commissioners, and reports to Congress. There are seven bureaus that operate under the FCC's umbrella. They include the Cable Services Bureau, the Common Carrier Bureau, the Consumer Information Bureau, the Enforcement Bureau, the International Bureau, the Mass Media Bureau, and the Wireless Telecommunications Bureau. These bureaus are responsible for developing and implementing regulatory programs, processing applications for licenses or other filings, analyzing complaints, conducting investigations, and taking part in FCC hearings.

The Telecommunications Act of 1996 has given much more control and jurisdiction to the FCC in regards to newer and newer technologies. Wireless data transfers were not an issue in 1934. But they are now. The FCC regulates not only the new technologies, but also the POTS (Plain Old Telephone Service) lines, as well as cable service, television, satellite transmissions, etc. If there is a means to communicate something, chances are that the FCC will


As well as expansion, it also gave the FCC much more to keep an eye on, especially when many firms decided they could not expand where they wanted without the money and resources of another firm. Hence, mergers became very popular and the FCC became more and more involved where the Justice Department would have normally made most decisions.

These companies argue that without a merger they will not be able to explore and expand upon future opportunities. Opportunities that will, they argue, allow for expansion into new markets that will allow them to eventually lower prices and offer new services to future and existing customers.

Obviously, stockholders are pushing for mergers, as they should allow for higher profits through increased market share and competition. The main argument put forth by the companies is that with more resources, both capital and technology, it would allow them to enter new markets and bring with them competition to a monopolistic environment.

A question on the minds of some of the commissioners is why a multi-billion dollar company needs more resources than it already has to compete and expand to new territories. As Gloria Tristani, a commissioner with the FCC, said, "In all candor, I'm a little skeptical of the notion that

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Approximate Word count = 857
Approximate Pages = 3 (250 words per page double spaced)


  

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