The pairing of SBC Communications Inc. (NYSE: SBC) and AT&T Corp. (NYSE: T) and press reports of a hook-up between Verizon Communications Inc. (NYSE: VZ) and MCI Inc. (Nasdaq: MCIP) point to a rapidly consolidating fixed-line market in the U.S., reflected in some of the latest market figures.

According to survey data from TNS Telecoms, the third quarter saw SBC with a 19 percent share of the wired telecom market and AT&T with 9 percent. Accounting for 28 percent of revenues, the combined company would take over the top spot from Verizon, which held a 22 percent share. But joining up with MCI would bring Verizon almost even, at 27 percent.

That puts 55 percent of the market in the hands of two mega-merged players, which also snatched share away from Qwest Communications International Inc. (NYSE: Q) and Sprint Corp. (NYSE: FON) compared with the previous quarter (see table below).

Table 1: Share of Wired Line Revenues

The consolidation signals the reunion of local and long-distance services in the U.S. -- Verizon and SBC each account for around a quarter of local phone services and, along with AT&T and MCI, dominate the declining long-distance market. SBC/AT&T alone would represent 37 percent of the long-distance segment.

Table 2: Local Phone Services Market Share

Table 3: Long Distance Phone Services Market Share

It's worth noting that rather than representing complete market share data, the figures come from TNS Telecoms' database of telecom bills and promotional material from 32,000 U.S. households.

In the households surveyed, average spending on all telecom services grew 4 percent quarter over quarter, to a total of $164.91. The largest growth was in the wireless segment, led by Verizon Wireless and Cingular Wireless LLC, the joint venture between SBC and BellSouth Corp. (NYSE: BLS).

Table 4: Average Consumer Spending (across all households)

The table below shows the break-down of communications dollars by provider. SBC/AT&T would jump to the top of the pile, accounting for 10 percent of total telecom spending, with a Verizon/MCI combo in second place representing 9 percent.

Table 5: Share of Communications Wallet

— Nicole Willing, Reporter, Light Reading