Reach Out and Stiff Someone : Media merger: The Bell-TCI deal would lock phone and cable users into a monopoly.

The proposed merger between Tele-Communications Inc. (TCI) and Bell Atlantic should send a powerful warning about the emerging “information highway”: Unless we’re careful, there will be no fork in the road.

The merger would create the sixth-largest corporation in the United States. When antitrust laws were still enforced, this alone would have been cause for alarm. But the new company will reach into two out of five homes in America with the single most important wire of the future, carrying telephone, computer, television and other interactive services.

The new company would not be just another good old-fashioned mega-corporation. Consider: If you don’t like GM’s cars, buy a Ford or a Toyota. Don’t like IBM computers? Buy Apple or DEC or Dell. But in the communities that TCI-Bell will serve, there will be no real alternative for the single wire carrying information into the home.

TCI-Bell will spend a lot of time and money telling us otherwise in the coming months. They will say that we have a broad range of choices already, which is getting broader by the day: cellular phones, long-distance competition, VCRs, broadcast television . . . ad nauseam. They will be aided by a wrong-headed Clinton-Gore Administration that seems to be equating information infrastructure with information monopoly, in a 1990s version of “what’s good for GM is good for the country.”

But Vice President Al Gore ought to think back two years to the many complaints about cable he received as Sen. Gore. His Tennessee constituents were outraged by their local cable monopolies and demanded action. Enough Americans agreed that even a gridlocked Congress re-regulated cable in 1992.

TCI is the most ruthless of the cable monopolies. Now that its president, John Malone, has joined the ranks of the information elite, he is being hailed as a visionary by America’s business pages. But the John Malone who told McNeil-Lehrer viewers last week that TCI would not seek monopoly control of the information industries had different views not long ago: In 1984, Malone compared the cable industry to “a game of Monopoly” and said that TCI’s primary goal was to leverage cash flow and assets to buy more property. He called TCI a “mammoth tax shelter” and said that earning money and paying taxes and dividends was “stupid.”

TCI was an early leader in interactive cable technology, and it standardized cable packaging to centralize its control over consumers. Along the way it bought stakes in major programming services, including Ted Turner’s TBS (and CNN), the Discovery and Family channels, Black Entertainment Television and Barry Diller’s QVC home shopping network (now bidding for Paramount).

TCI is not just another cable company. It is the linchpin of the cable television industry.

TCI has developed a reputation as the most aggressive member of an industry not known for its public-interest etiquette. In 1980, the city of Boulder, Colo., revoked TCI’s municipal franchise agreement, after the company had wired only 10% of the city in 13 years. TCI sued, claiming that its First Amendment rights had been violated, and perversely charging the city with antitrust violations. Boulder settled, in a now familiar pattern.

Contrary to deregulatory myth, consumers cannot just go out and find another phone company. Competition for cellular and long-distance communication will not bring prices down for quite some time, if ever. Still, if it does, most middle- and working-class Americans don’t want or need cellular phones. Even most small businesses don’t need cellular phones. What most of us need is cheap, reliable phone service and, more and more, cheap, reliable cable service to remain informed and active citizens. This will become truer as the broadcast networks and even local broadcasters become integrated into the emerging cable-phone monopolies.

The Clinton Administration needs to stop talking out of both sides of its mouth. The long-term interests of the public in the information highway conflict with the goals of the emerging information conglomerates. Assuming that the market will automatically serve everyone conveniently forgets the aftermath of deregulation in the 1980s.

We have a long and honorable history of public-interest antitrust regulation in the United States. Let’s dust it off and use it.