WASHINGTON - If the Federal Communications Commission votes as planned on AT&T Inc.'s acquisition of BellSouth Corp. on Friday, it means the agency's Republican chairman compromised with two outspoken Democrats who sought significant changes in the deal.

Past comments from Democratic commissioners Michael Copps and Jonathan Adelstein and word from people familiar with the negotiations suggest points to some of the remaining unresolved issues, including:

_"network neutrality," which deals with whether Internet service providers must provide equal treatment to all traffic on their networks.

_"interconnection," or the right to access an incumbent telephone company's network.

_a possible divestiture of some of BellSouth's wireless broadband spectrum holdings.

Copps and Adelstein are in an unusually strong position on the five-member commission, which has three Republicans. One of those GOP commissioners, Robert McDowell, is a potential tie-breaking vote who has withdraw from the case because he was a lobbyist who representing competitors of AT&T and BellSouth.

Republican Deborah Taylor Tate is expected to vote with the agency chairman, Kevin Martin, in favor of the acquisition.

The FCC is the last major regulatory hurdle for the deal. The Justice Department on Wednesday approved AT&T's purchase without any conditions.

When the deal was originally announced, it was worth about $67 billion. But the rising price of AT&T's stock has pushed the value of the deal to $80.8 billion at the close of trading Thursday.

The deal would extend AT&T's dominance as the biggest provider of phone, wireless and broadband Internet services.

After the Justice Department's decision, Adelstein denounced it as "a reckless abandonment" of the department's responsibility to protect consumers and smaller businesses.

The FCC vote was scheduled for Thursday, but was pushed back a day so Martin had more time to negotiate with the two Democrats.

There still was a chance Martin could ask McDowell to vote, but only if the FCC's general counsel determines the former lobbyist does not have a conflict of interest.

Much can be learned from what Copps and Adelstein said after they approved the Verizon Communications Inc.-MCI Inc. and AT&T Corp.-SBC Communications Inc. mergers.

For example, on the network neutrality issue, they wrote: "Consumers will have an enforceable right to use their bandwidth as they see fit, going where they choose and running the applications they want on the Internet."

Jessica Zufolo, an independent equity analyst with Medley Global Advisors, said the commissioners probably would argue for strong interconnection requirements from AT&T. Telephone service offered by a cable company must be able to connect with a wireline provider to stay in business.

Zufolo said that interconnection standards need to be affirmed to include cable voice-over-internet and other entrants such as Vonage. She said some telephone companies, large and small are "very actively pushing back against the onslaught and growth" of such communication.

There may also be a discussion about divesting BellSouth's radio spectrum holdings in the 2.5 GHz band, which could be used by independent competitors to offer a wireless broadband option. AT&T would not have much incentive to offer a broadband service that competes with its own DSL (digital subscriber line) service.

AT&T would not discuss the negotiations. A company spokesman, Michael Balmoris, said "it's always been our position that we would accept any reasonable conditions in order to obtain approval from the commission."

AP Wire | 10/12/2006 | AT&T-BellSouth deal hinges on Democrats