AT&T Didn't Violate Antitrust Laws In Wholesale DSL Pricing

from the really? dept

Well, this is certainly interesting. Just as the US government seems to be hinting at the possibility of declaring Google a monopoly, the Supreme Court has overturned a lower court ruling on whether or not AT&T violated antitrust laws in pricing its wholesale DSL lines at a price above its retail rates (i.e., other DSL providers could resell AT&T DSL lines, but they would have to price them significantly higher than AT&T or lose money). The Supreme Court has now said that it's not an antitrust violation to have priced line sharing in this manner.

I can certainly see the arguments for both sides in this ruling. In theory, AT&T should have the right to price its offerings wherever it wants. But, that ignores that AT&T does have a monopoly in terms of government granted rights-of-way and subsidies, such that no other provider can realistically compete without similar government benefits. This isn't because AT&T grew into a monopoly, but because the government granted them those rights and subsidies. In the end, though, as much as I think we should encourage competition via line sharing, I think the Supreme Court made the right decision, in realizing that this isn't an antitrust issue, but a regulatory issue. When the gov't granted AT&T rights of way and subsidies, it could have (and probably should have) extracted certain requirements concerning line sharing. In not doing so, it implicitly allowed AT&T to price such line sharing at whatever ridiculous rates AT&T wanted. The solution isn't via an antitrust lawsuit as it is in making sure that granting such rights of way and subsidies comes with reasonable line sharing rules.

Filed Under: antitrust, line sharing, supreme court
Companies: at&t