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Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:

AT&T: Waiting for the FCC's Call [BusinessWeek]

Summary: The Justice Department gave the nation's largest telecom company, AT&T (NYSE:T) the go-ahead to acquire Bell South (BLS) for $67 billion in a no-strings-attached deal that has left some at the FCC baffled.att Had the Justice Department let the FCC move first, the deal would have likely went through with AT&T able to avoid most of the antitrust and pro-consumer concessions that usually accompany such large, industry-shaking deals. Now, the FCC feels it is in a bind and must protect other smaller telecom companies as well as U.S. consumers from the possibility of price gouging and an AT&T quasi-monopoly. Of the FCC's five commissioners, Chairman Kevin Martin and fellow Republican commissioner Deborah Tate support the concession-free deal while Democratic commissioners Jonathan Adelstein and Michael Copps, say the company will require at least some concession making to get the green light from them. Said Copps, "With the lights off at the Justice Dept., it becomes all the more important for the FCC to ensure that consumer interests have a seat at the table." The fifth commissioner, Republican Robert McDowell, was once a lobbyist with COMPTEL, a telecommunications association that represents AT&T's competitors and therefore will abstain from voting meaning the deal can only be passed through compromise. Among the compromises on the table are that AT&T might have to agree to a price freeze on high-capacity business lines, a $15 billion business and it might also have to change how it bundles services such as digital subscriber lines [DSL].
Related links: * AT&T Q2 2006 Earnings Conference Call Transcript * AT&T/ BellSouth Merger: Is Ma Bell Calling Back Her Babies? * Citi: Buy AT&T and Sell Verizon * Annals of Accounting: A Look at AT&T and Verizon's Methods * Trailing 12 Month P/E for Telecom Companies * AT&T Merger Vote Possible Today
Potentially impacted stocks and ETFs: Verizon (NYSE:VZ), iShares Dow Jones US Telecom (NYSEARCA:IYZ), Sprint Nextel (NYSE:S), Time Warner Telecom (NASDAQ:TWTC), Vanguard Telecom Services VIPERs (NYSEARCA:VOX)

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Source: AT&T-BellSouth Merger Still Needs FCC Clearance