If they're afraid of anybody, SBC fears the cable companies, which have a two-year head start offering broadband Internet access. AT&T even spent $100 billion to buy cable companies and use those networks to offer phone and Internet services without having to deal with the Baby Bells.
Whatever their inherent advantages, the Bells' ultimate victory in the communications war will be hard-won.
While the companies' local phone revenues give them a level of comfort few telecoms enjoy, those revenues are largely fixed, with little room for growth. And even though SBC has made a huge bet on data services and DSL to compensate for the flat local service market, the new markets are not taking off fast enough to compensate for the investments.
A bunch of new companies are moving into the Bells' metro markets, trying to steal business customers with new networking technology. Companies such as San Francisco's Yipes and Denver's Telseon are offering more bandwidth and promising to deliver it faster than the Bell companies ever could.
But if the Bells have their way, people may someday remember the 17 years since the breakup of AT&T as an aberration. The days when consumers had a local phone company, a different long-distance provider and another company for Internet access are going to go away.
"I've been in this business 35 years," says SBC's chief technical officer, Ross Ireland. "People have predicted our downfall a lot in the last couple of decades. We never let that get to us, and we never will."
