USA Today technology columnist Kevin Maney argues that the AT&T-BellSouth merger arises out of the weaknesses of both companies, not their strengths. Three years ago, BellSouth's president confided to Maney that business was horrible, with customer losses hitting anywhere between 30 and 50 percent. In today's column, Maney says "if anything, BellSouth's future looks worse now than it did then," and later, he notes several analysts who agree AT&T is "a leaky boat" that is "about to pay $67 billion for another hole." One analyst says AT&T has poor "capital velocity"--meaning the company has such a mountain of debt …

In the fast-moving, high-stakes world of Internet media, constant spending has proved to be a requirement for "established players" wanting to stay ahead of smaller, lithe competitors ready to pounce on areas of visible weakness. This is the new reality, says The Wall Street Journal, perhaps best reflected in the volatile stock prices of media and technology companies on major stock exchanges around the world. These pressures mean Web companies need to spend heavily on personnel, technology, and products and services to stay ahead of competitors and relevant to consumers. Think of the present activity of major media …

Wal-Mart has given consumers one more glaring reason not to trust everything you read on the Internet. The retailing giant has enlisted several bloggers to evangelize the retailing giant and, in particular, to defend management's controversial decisions; right now this refers to the company's refusal to spend more on employee health insurance. The New York Times found several sentences on one blogger's site that had been extracted verbatim from a note written by employees at Edelman, one of Wal-Mart's public relations firms. The world's largest retailer is being very upfront about this latest word of mouth marketing initiative, saying …

Top executives at major book publishers discussed the entry of Web companies like Amazon and Google into their territory at a publishing industry conference in London. The executives who spoke on the panel sounded as if they couldn't decide whether they were discussing a challenge or an opportunity. A HarperCollins UK executive said Amazon, which is moving directly into publishing, represented a threat, but her comments were later disqualified by a spokesperson for the company who said, "I think we'd argue that Amazon is a real friend to the publishing industry," adding that the online retailer helped boost sales of …

Microsoft's new update to its Internet Explorer browser could have implications for rich media advertisers and vendors, writes ClickZ--in some cases requiring that users click on an ad or video before it plays. The shake-up is the result of a patent dispute with a small software company called Eolas, which a few years ago won a patent dealing with the way plug-in applications are called in a browser. According to the article, because the decision has been looming for so long, many rich media vendors have already made adjustments to their applications, so the changes won't be noticed by Internet …

In another sign of phone companies moving into the content delivery business, Cingular today is announcing an on-demand TV service that will run over its new 3G wireless network. Called Cingular Video, the service lets users select short three- to five-minute clips from 18 different content providers, including NBC, ESPN, HBO, Fox News, and the Cartoon Network. The service will be available to Cingular customers who purchase an unlimited 3G data package. The data package costs $19.99 per month, and includes unlimited text, e-mail, and picture sharing, as well as the Cingular video service. HBO clips require an additional premium …

As competition heats up among major Web companies, a few are having to kick their clean-up initiatives into overdrive following the unscrupulous comments of certain loose-lipped executives. After single-handedly causing his company's stock to sink 14 percent, Google's George Reyes' comments come to mind, although Google qualified his negative-sounding statements later that day to halve the damage. A few weeks ago, Microsoft's European President Neil Holloway left many search industry watchers scratching their heads when he boldly proclaimed that Microsoft would be "more relevant" in the U.S. market than Google in six short months. Ken Moss, general manager for Web …

According to The New York Times, the fear that phone companies will start charging Internet publishers for displaying their pages at faster speeds mounted yesterday as AT&T announced it would buy BellSouth, creating a telco behemoth with $130 billion in sales and 70 million phone customers in 22 states. Why? Because it was the Bells' idea to share the costly burden of upgrading their networks with Internet companies needing to send out data that requires more bandwidth per consumer. The combined company could presumably put some serious lobbying weight behind the initiative. The cost-sharing idea has raised red flags among …

An anti-spyware researcher says Symantec Corp.'s out of court settlement with Internet toolbar maker Hotbar last week is a loss for Web users. Last June, Symantec filed a suit against New York-based Hotbar, seeking a legal ruling that would classify Hotbar as an adware provider and a potential computer security risk. Under an out of court agreement struck with Hotbar, Symantec agreed to dismiss the lawsuit, but maintained that the settlement was a victory. The anti-virus company will continue to detect Hotbar's products as adware, but is changing the recommendation it gives consumers, calling Hotbar "low-risk" and recommending that users …

Online retailers are turning to RSS, or really simple syndication, to feed product alerts to Internet users who want to know instantly when designers bring new products to market. Companies like eBags, ice.com, Tower Records and others are using RSS to feed product alerts to Internet users on their personalized Google, Yahoo or other pages. As The New York Times points out, RSS gives merchants a way to hedge against the recent decision by AOL and Yahoo to start charging for bulk commercial e-mails. Says Jon Newmark, chief executive of eBags: "Rather than delivering a slightly relevant message to …