"It's the return to dominance" for the regional phone giants.

But they do not trust cellular phone giants backed by Federal clout.

The mobile phone giant was persuaded to cough up £1.25 billion to settle a long-running tax dispute.

Most of the European phone giants that might have been interested a year ago are shedding assets to raise cash.

Telebras, the Brazilian phone giant, is preparing to break up into 12 companies this month.

If the phone giant raised prices, competitors would be well positioned to take away their business.

The mobile phone giant announced this week that pay-monthly customers will be hit by a 4.34pc price rise in the new year.

AT&T, the once-mighty phone giant, has a pension plan with obligations of about $10 billion, according to its annual report for 2003.

But the phone giant still insisted that Carterfone posed a danger.

So despite cable's lead, the local phone giants insist that they will ultimately be able to offer a more attractive high-speed Internet service.