MERGERS
MCI WorldCom, Sprint Ponder Merger (WSJ)
EarthLink, MindSpring to Link Up, Challenge AOL (SJM)
Takeover of Ameritech is Nearly a Done Deal (CT)
BROADCASTING
BET Chief Restates Interest in Joining With UPN Network (WSJ)
Disputes Over Rights Arise As Stations Turn to Web Broadcasts
(SJM)
MERGERS
MCI WORLDCOM, SPRINT PONDER MERGER
Issue: Merger
MCI WorldCom and Sprint have been talking about a merger that would
combine
the nation's second- and third-largest long-distance carriers. If
MCI WorldCom buys Sprint, it would finally give MCI WorldCom a
nationwide
wireless network and boost its global presence in telecom. Sprint alone
is
valued at nearly $40 billion and its wireless business is valued at
about
$33 billion. MCI WorldCom has a far higher valuation at about $151
billion.
People familiar with the situation said that both sides have discussed a
financial structure for a deal in which MCI WorldCom would acquire
Sprint's
core business for stock. MCI WorldCom also would exchange Sprint's
existing
tracking stock for a new WorldCom tracking stock. This deal would
attract
close scrutiny by regulators as together, the companies would hold about
30%
of the U.S. consumer long-distance market. Another possible problem is
Deutsche Telekom and France Telecom, as each own 10% of Sprint and could
block the deal. Sprint probably would have to shed its Internet-backbone
business as part of the deal because MCI WorldCom already has its UUNet
division, which handles Internet traffic for AOL.
[SOURCE: Wall Street Journal, (A3), AUTHOR: Rebecca Blumenstein & Steven
Lipin]
(http://interactive.wsj.com/articles/SB938139008356922263.htm)
EARTHLINK, MINDSPRING TO LINK UP, CHALLENGE AOL
Issue: Merger
Yesterday, MindSpring Enterprises and EarthLink Network announced plans
to
merge, making the combined company the second largest Internet service
provider behind AOL. The new company will be called EarthLink. The
combined
2.8 million subscribers between EarthLink and MindSpring will move the
newly merged company ahead of Microsoft Networks' 1.8 million and AT&T's
estimated 1.7 million subscribers. However the company will still be far
behind AOL's 20 million subscribers. Still, MindSpring and Earthlink say
the
move is intended to allow the new company to compete with and undercut
AOL
The merger, expected to be completed sometime this spring, will produce
about $650 million in annual revenues and 4,000 employees. EarthLink and
MindSpring believe the new company will be able to grow at a much faster
pace predicting it will have 5 million subscribers next year and 8
million
in 2001. Each EarthLink share will be converted into 1.615 shares of the
new
company's stock and each share of MindSpring will be exchanged for one
share
of the new company.
[SOURCE: San Jose Mercury News, AUTHOR: Chris O'Brien]
(http://www.sjmercury.com/svtech/news/indepth/docs/mind092499.htm)
TAKEOVER OF AMERITECH IS NEARLY A DONE DEAL
Issue: Merger
The Illinois Commerce Commission (ICC) approved the acquisition of
Americtech by SBC Communications yesterday. SBC, a San Antonio based
company, must still receive approval from the Federal Communications
Commission for the takeover, but an agreement reached during the summer
suggests FCC approval will not be difficult to obtain. Ameritech's
takeover
was opposed by the ICC because of SBC's potential to stifle local phone
competition. Even with the acquisition given its blessing, the Illinois
commissioners are unsure of whether the deal will be good for customers.
Critics of the deal argue that SBC will raise rates in order to finance
its
bid to become a national carrier. Final action is expected from the FCC
in
two weeks.
[SOURCE: Chicago Tribune, AUTHOR: Jon Van]
(http://chicagotribune.com/news/printedition/article/0,2669,SAV-990924010...)
SEE ALSO:
ILLINOIS REGULATORS OK SBC/AMERITECH DEAL
[SOURCE: San Jose Mercury, AUTHOR: Anna Driver]
(http://www.mercurycenter.com/svtech/news/breaking/reuters/docs/886727l.htm)
BROADCASTING
BET CHIEF RESTATES INTEREST IN JOINING WITH UPN NETWORK
Issue: Minority Broadcast Ownership
BET Holdings Chief Executive Robert Johnson said he remains interested
in
combining his company with the struggling UPN broadcast network. Johnson
said he is examining a potential combination of BET, which owns the
Black
Entertainment Television cable channels and UPN. He also said that he
placed
a call Thursday to Herbert J. Siegel, chairman of Chris-Craft
Industries, a
50% owner of UPN, to initiate talks about a combination of the two media
outlets. Chris-Craft and Viacom, which owns the other 50% of UPN,
declined
to comment. Government regulators have indicated that Viacom may have to
unload its interest in UPN, the nation's sixth-largest broadcast-TV
network,
to win approval for its proposed purchase of CBS because of FCC rules
barring one company from owning two broadcast networks. In response,
Viacom
executives have argued that forcing Viacom to sell its stake in UPN
might
extinguish a programming voice that has built a niche serving
African-American viewers. Johnson said he thinks a broadcast network
owned
by the minority community would better serve the "true interests" of the
minority audience.
[SOURCE: Wall Street Journal, (B7), AUTHOR: Sally Beatty]
(http://interactive.wsj.com/articles/SB938129760189131645.htm)
DISPUTES OVER RIGHTS ARISE AS STATIONS TURN TO WEB BROADCASTS
Issue: Webcasting
Major League Baseball's legal offices are requiring stations around the
country to suspend Web simulcasts of their sporting events. They argue
that
the Webcasts are violations of copyright and other specific contractual
clauses. The issue is a symptom of technologies outpacing law.
Professional
basketball and football have similar restrictions as well. Televisions
stations have been more inclined to cease their Webcasts than pay for
the
costs of securing a second set of broadcast rights. Web simulcasts are
problematic
outside of sports as well. Yahoo! runs broadcast.com which offers
hundreds of
Webcasts. Broadcast.com constantly checks to make sure they are within
copyright limits. Vice President Kevin Parke notes that problems arise
most when the contracts fail to define the scope of rights within
copyright.
[SOURCE: San Jose Mercury, AUTHOR: Staff Writer]
(http://www.mercurycenter.com/svtech/news/breaking/merc/docs/012778.htm)
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