MCI, Sprint file to join forces

By KALPANA SRINIVASAN

The Associated Press

WASHINGTON --- MCI WorldCom and Sprint filed for approval of their proposed merger with the Federal Communications Commission on Wednesday and defended the deal as an appropriate answer to today's changing marketplace.

Officials from both companies said they expect the deal to pass regulatory muster and hope it will be cleared by the middle of next year.

The two businesses pressed their view that the deal isn't a marriage between the No. 2 and No. 3 long-distance companies but more broadly a merger between the No. 4 and No. 7 telecommunications businesses.

The companies want to position themselves to offer a combination of long-distance, wireless and high-speed Internet services with the deal, announced in October and originally valued at $115 billion.

"Two or three years ago, this would be very hard to get done," Sprint general counsel J. Richard Devlin said of the merger.

But the companies believe there are enough competitors in the market now, with some 600 long-distance carriers, and no obstacles to new businesses getting in.

Company officials said they anticipated antitrust regulators reviewing their case also would consider what the state of the market will be in a few years. With at least one of the regional Bell companies on the brink of receiving permission to enter the long- distance business, it could alter the landscape of competition even further, they said.

"I think people will have an open mind. I think we have to persuade them," said Michael Salsbury, MCI general counsel.

When the deal was announced, FCC chairman Bill Kennard said the companies would "bear a heavy burden to show how consumers would be better off." Joel Klein, the assistant attorney general in charge of the Justice Department's antitrust division, also promised at the time that the deal would get "a very serious and thorough review."

But both agencies this weekend stressed that no decision has been made on the transaction.

Devlin acknowledged that concerns have been raised about the amount of control the merger would give the two companies over the Internet backbone --- the massive data pipelines that crisscross the nation carrying computer traffic.

"Sprint is prepared to address that issue," Devlin said.

Some analysts have speculated that Sprint might have to shed some of its backbone for the deal to receive approval.

"Two or three years ago, this would be very hard

to get done."

--- J. RICHARD DEVLIN, Sprint general counsel

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