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AT&T, Viacom, SBC Asked for Easing of Conditions Tied to Deal Approvals

Three of the nation's largest communications companies have recently sought to pare back commitments to which they agreed in mergers, testing federal regulators' resolve to enforce conditions negotiated during the Clinton administration, Thursday's Wall Street Journal reported.

With Republicans in control of the Federal Communications Commission, AT&T Corp. (T), SBC Communications (SBC) and Viacom Corp. (VIA) have sought to postpone or scale down merger conditions. In the process, they have challenged Chairman Michael Powell's enthusiasm for the sort of conditions he questioned during his three years as an FCC commissioner.

AT&T last week got the agency to postpone a deadline for the company to sell some of its cable assets, a condition AT&T had to meet to win FCC approval of its acquisition of MediaOne Inc.

At the same time, Viacom unsuccessfully pushed the agency for more time to sell some television stations to come into compliance with federal ownership caps. And SBC this month scaled back plans to offer local phone service in a half dozen major markets, a promise it had made as a condition for buying Ameritech.

The companies deny that they are trying to take advantage of the change in administrations to retreat from promises. SBC cited the slowing economy and its inability to win regulatory approval to offer long-distance telephone service to big corporate customers; AT&T and Viacom, which are both based in New York, said they were reacting to a court decision striking down federal caps on cable ownership.

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